Can You Use a Reverse Mortgage to Buy a Home in Sarasota or Manatee?

What Is a HECM for Purchase, and Can You Use One Here?

If you are weighing a move to Sarasota or Manatee County, or within it, you may have heard that a reverse mortgage can be used to buy a home instead of only to borrow against one you already own. That is true, but it is a different transaction from a regular purchase loan, and the details matter before you write an offer.

The program is called the Home Equity Conversion Mortgage for Purchase, or HECM for Purchase. Below is what HUD and the Consumer Financial Protection Bureau say about it, what it does not do, and the questions to settle before you are under contract. This is general information, not financial advice, so talk with a HUD-approved counselor and a lender before you commit.

Who Qualifies for a HECM for Purchase?

The CFPB says a HECM for Purchase allows people 62 and older to buy a new principal residence with HECM loan proceeds. HUD’s HECM overview lists the basic requirements: you must be 62 or older, occupy the property as your principal residence, take part in a consumer information session given by a HUD-approved HECM counselor, and have the financial resources to keep paying property charges such as property taxes. HUD lists eligible property types as a single-family home, a 2-4 unit home with one unit occupied by the borrower, a HUD-approved condominium or qualifying individual condo unit, and an FHA-compliant manufactured home. The CFPB adds that cooperative units and some manufactured homes are ineligible.

How Much Cash Do You Still Need to Bring?

More than many buyers expect. The CFPB states that you will need cash available for the down payment, and that you must pay the difference between the HECM proceeds and the sales price, plus closing costs. The CFPB also says closing costs on this loan will be higher than those on other reverse mortgage loans, and that some may be paid by the seller depending on state law. HUD lists the age of the youngest borrower or eligible non-borrowing spouse, and for a HECM for Purchase the sales price, among the factors that set the loan amount, so your lender’s written estimate is the number to rely on, not a rule of thumb. For context, HUD’s announcement of its loan limits puts the HECM maximum claim amount at $1,249,125 for case numbers assigned on or after January 1, 2026. Mortgage insurance is also part of the cost: HUD says the initial premium is 2% and the annual premium is 0.5% of the remaining loan balance, and that the premium can be financed into the loan.

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What Do You Keep Paying After You Close?

No monthly loan payment does not mean no housing costs. The CFPB says you must keep living in the home as your principal residence and pay your property taxes and homeowners and flood insurance premiums on time. The CFPB’s reverse mortgage guide adds that you keep the right to stay as long as you keep current on property taxes, insurance, and home repairs, and that you could face foreclosure if you run out of money to pay them. Interest is added to the loan balance each month, so the balance grows. Because a reverse mortgage does not remove these costs, price them for the specific home before you offer. Our posts on Florida home insurance rates and how Florida property taxes work for buyers explain what to expect, and your agent can help you request real quotes for a particular address.

What Happens When You Move Out or Pass Away?

A HECM can become due when the last borrower dies or permanently leaves the home, or when other loan obligations are not met. An eligible non-borrowing spouse may qualify for a deferral under HUD rules; that protection is conditional, not automatic. Ask the HUD-approved counselor and lender to document who is a borrower, who qualifies for spouse protections, and which ongoing occupancy, property-charge, and maintenance requirements apply. HUD’s non-borrowing spouse policy explains the protections. The loan’s nonrecourse protections also matter to the borrower and heirs; discuss the repayment options with the servicer before making decisions about the home.

How Does a Reverse-Mortgage Purchase Compare With Paying Cash or Using a Regular Loan?

Sarasota Magazine’s write-up of the latest third-quarter data from the Realtors Association of Sarasota and Manatee reports that about 61% of Sarasota County condo and townhome purchases, and 37.6% of single-family purchases, were cash. The report does not say how sellers respond to reverse-mortgage purchase offers, so ask your agent how the seller’s side is likely to view your terms and timeline before you write them. If you are weighing options, our posts on buying with cash or a loan and how mortgage pre-approval works in Florida cover the general financing questions that apply to any purchase. Source: Sarasota Magazine, Q3 data from the Realtors Association of Sarasota and Manatee.

How to Protect Yourself Before You Commit

1. Book the Counseling Session Before You Shop: HUD requires a session with a HUD-approved HECM counselor, and the CFPB calls HUD-approved counseling your best source of information on reverse mortgages. The CFPB lists 800-569-4287 for finding a counselor.
2. Get a Written Cash-to-Close Estimate: Ask the lender for the cash you will need for the difference between the loan proceeds and the price, plus closing costs, at the price range you are considering.
3. Compare Lenders on Costs: The CFPB says closing costs are higher on this loan and advises shopping around. Ask each lender to itemize closing costs and the initial and annual mortgage insurance premiums.
4. Confirm the Property Is Eligible Early: Ask the lender to verify the property’s FHA eligibility before you write an offer. A condo may qualify through project approval or applicable individual-unit approval; do not assume a building’s marketing description settles eligibility.
5. Price Taxes, Insurance, and Repairs First: You must stay current on property taxes, insurance, and repairs, so get a real insurance quote and a tax estimate for the specific home, and have it inspected.
6. Decide Who Goes on the Loan: Ask the counselor to distinguish borrowers from eligible and ineligible non-borrowing spouses and explain what happens if a borrower dies or moves out.

What a Local Agent Catches That You Won’t See in the Listing

A local agent cannot approve or price the loan, and I am not your lender or counselor. What an agent can do is pull recent sales for similar homes so you know what a fair price looks like, help you request insurance and tax figures for the address, and coordinate with your lender so the eligibility questions, such as condo project approval, are answered before your deadlines run. That keeps the loan paperwork from becoming a surprise in the middle of the contract.

Before you tour homes, schedule the HUD-approved counseling session, ask a lender for a written cash-to-close estimate, and confirm whether the property type, especially a condo, is eligible. Then call me at 941.400.8735 and we can talk through price range and timing.

About the Author

I’m Michael Renick — a Florida West Coast broker with over 15 years guiding families through some of the biggest decisions of their lives. I’ve built my practice on hard work, honesty, and total transparency. No shortcuts, no spin — just straight answers, deep market knowledge, and the dedication my clients deserve from start to close.

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Equal Housing Opportunity. This article is general information only, not legal, tax, insurance, or financial advice. Market conditions, insurance requirements, and costs vary by property and transaction; confirm your specific situation with the appropriate licensed professional. Michael Renick, Licensed Florida Real Estate Broker, License #BK3241900, licensed by the Florida Department of Business and Professional Regulation (DBPR). Mangrove Realty Associates Inc — each office is independently owned and operated.

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