HECM for Purchase: How to Buy a Home at 62+ With No Monthly Mortgage Payment

The consumer-facing name is often Reverse Mortgage for Purchase (H4P). The program mechanics, disclosures, and FHA insurance are the same whether your lender uses the HECM or H4P label on marketing materials.

How HECM for Purchase Works

You find a home, sign a purchase contract, and apply for a HECM for Purchase loan. The transaction typically closes in one settlement: you bring the required borrower contribution from savings, sale proceeds, or other eligible funds, and the HECM covers the remainder up to your Principal Limit Factor. According to HUD Mortgagee Letter 2025-22, the 2026 HECM lending limit is $1,249,125 — the maximum home value used in the calculation regardless of actual purchase price.

There is no required monthly mortgage payment as long as you live in the home, pay property taxes and homeowners insurance, and maintain the property. Interest accrues to the loan balance over time. See our HECM for Purchase complete 2026 guide for step-by-step closing timelines.

Who Qualifies for HECM for Purchase

• Youngest borrower (or eligible non-borrowing spouse) must be at least 62 for the federal HECM program
• The home must be your primary residence — not a second home or investment property
• HUD-approved reverse mortgage counseling is required before closing
• Financial assessment, credit history review, and FHA appraisal apply
• Property must meet FHA eligibility (single-family, FHA-approved condo, etc.)

California homeowners age 55 to 61 may qualify for proprietary purchase programs instead of HECM. See proprietary reverse mortgage options in California.

Down Payment and Borrower Contribution

According to HUD program documentation, the borrower contribution on a HECM for Purchase typically ranges from 40 to 60 percent of the purchase price depending on age and rates. A 70-year-old buyer generally needs less cash at closing than a 62-year-old buyer on the same home. Use the free reverse mortgage calculator or our purchase down payment guide to model your specific numbers.

Ongoing Obligations After Closing

You must occupy the home as your primary residence, stay current on property taxes and homeowner's insurance, and maintain the property. Program rules are set by HUD; participating lenders apply overlays. Falling behind on taxes or insurance is a default trigger under CFPB guidance — the same risk that applies to any homeowner, paid-off or not.

Regional Planning Guides

• HECM for Purchase in California (2026)
• HECM for Purchase in Arizona
• HECM purchase vs conventional mortgage at 65
• Reverse mortgage purchase in San Diego

Frequently Asked Questions

What is a HECM for Purchase?

It is the FHA HECM program used to buy a new primary residence in one closing. You bring required funds; the reverse mortgage finances the rest with no monthly principal-and-interest payment.

How much down payment is required?

Typically 40 to 60 percent of the purchase price per HUD documentation, depending on your age and current rates. Older borrowers generally need less cash at closing.

Is counseling required?

Yes. HUD requires independent counseling from a HUD-approved agency before any HECM closes, including purchase transactions.

This material is not from HUD or FHA and has not been approved by HUD or any government agency. All reverse mortgage loans are subject to credit and property approval. CA DRE #01456165, #01450361 · NMLS #307713 · AZ #1022722.