The seller likes the idea of moving. They’ve talked about a smaller home, fewer stairs, or being closer to the grandchildren. They’ve even looked at a few places. Yet every time the conversation gets serious, the answer becomes, “Maybe next year.”
For a Realtor and the family, that can be frustrating. The current home has equity, the reasons to move make sense, and the client seems interested. But the sale is only half the decision. The sellers also need to feel comfortable about what comes after it.
Someone who’s spent years paying off a house may be reluctant to put most of the sale proceeds into the next one. A conventional mortgage could leave more cash available, but its monthly payment may be equally unwelcome. Until that question is answered, staying put can feel easier than moving forward.
Ask about the part of the move that feels uncomfortable
A useful conversation can begin with something simple: “What would you need to know about buying the next home before you’d feel ready to sell this one?” Give the seller room to answer. The concern may have less to do with packing boxes than with what their bank account and monthly budget will look like afterward.
Listen for comments such as, “I don’t want another mortgage payment,” or, “I’d like to move, but I don’t want all my money tied up in the house.” Those are good reasons to introduce a financing option the client may have never considered.
The next home may have a third financing option
A Home Equity Conversion Mortgage for Purchase, commonly called a HECM for Purchase, lets an eligible buyer age 62 or older combine a substantial cash contribution with an FHA-insured reverse mortgage to buy a new primary residence. There’s no required monthly principal and interest payment while the loan terms are met. And, like any other mortgage, the buyer still owns the home and all the equity above the mortgage balance.
For a seller moving into another home, that can open a useful conversation. Instead of using enough cash to buy the next property outright, they may be able to use part of their proceeds and keep more available for retirement. The amount depends on the buyer and the property, so a current illustration is the best way to see what’s possible.
Think of a homeowner who wants to leave a two story house for a single level home closer to family. The homeowner may have enough equity to buy the next house for cash but dislike how little would remain available afterward. A HECM for Purchase could let them compare a move that retains more cash without adding a required monthly principal and interest payment to their budget.
The benefit is easy to picture: a home that’s easier to live in, family closer by, and cash available for needs beyond the house. A written comparison can help the homeowner decide whether that combination is worth the loan’s costs.
Help the client picture the move with the numbers included
If you think a HECM for Purchase may benefit your clients and their family, Richard can work with you and the client to show the cash needed for the purchase, estimated closing costs, and how the loan would fit their plans. He also encourages their financial advisor and family to participate throughout the process.
He will include the ongoing housing budget, too. Taxes, insurance, maintenance and applicable association charges continue, and the buyer must occupy the home as a primary residence. The loan balance generally grows as interest and mortgage insurance accrue. Those details belong in a clear comparison, along with how much cash the buyer could retain and what the absence of a required principal and interest payment would mean to them. As an added safeguard, independent counseling with a HUD-approved counselor is required for a HECM.
Sometimes that conversation helps the seller feel ready. Sometimes it gives them a clearer reason to wait. Either way, you’ve helped them replace an unanswered worry with information they can use.
If a client keeps saying “maybe next year,” ask what’s holding up the next home. Then call Richard. A short conversation may uncover a way to make the move feel much more comfortable. Call or text 404-313-9785, or email richard.mcwhorter@ridgereverse.com.
Richard W. McWhorter, NMLS 1618644. Ridge Reverse, powered by Amerifund. Equal Housing Opportunity. Information is subject to change. This isn’t an offer of credit or a commitment to secure a loan. Eligibility and terms vary. This material isn’t from HUD or FHA and hasn’t been approved by any government agency.