Maples at Sonatas touts new 62+ buyers’ plan
portico living room
In an effort to help buyers of retirement age of 62 or older who want to purchase a new luxury ranch-style home, Epcon Communities in Woodstock is offering a new FHA-backed financing option known as the HECM for purchase program.
Home Equity Conversion Mortgage, or HECM, may be a good financial option for retirees if they do not want the burden of a monthly mortgage payment, or if they have a home they cannot sell, but want to purchase a new home offering a stair-free, maintenance-free lifestyle.
Among its benefits, the HECM program allows buyers to move into a new home without depleting their savings or having to sell their existing home. Even better, they have no mortgage payment for the rest of their life.
How can this program assist a buyer that is 62+ years old? Because of the economic downturn, many people of retirement age are stuck in a tough situation; they want to sell their home and move on but cannot. The HECM for purchase program was created just for this reason. HECM buyers do not have to sell their existing home before they can afford their new home. The program allows buyers the additional money to customize their new home as much as they want, while still keeping their old home on the market until it sells.
Some buyers choose to rent out their “old place” instead, or sell it and use the additional cash for living expenses, travel, education, new vehicles or a variety of other things. These are viable options because the HECM program does not require all of a buyer’s assets to purchase a new home, nor a verifiable monthly income for mortgage payments because with an HECM, there are no monthly payments to be made.
Many buyers question the difference between a HECM mortgage and a traditional home equity loan. With a second mortgage or a home equity loan, borrowers must have adequate income stream to qualify for the loan; after all, they must make monthly payments to pay off the loan. The HECM program is different because it does not require monthly payments to be made; there are no monthly principal and interest payments due by the homeowner. In other words, the buyer is only required to pay real estate taxes, utilities, and hazard and flood insurance premiums.
When the homeowner moves or passes away, the home is sold and the HECM loan balance is paid off from the sale, just like a traditional mortgage. A unique attribute of the program is that if the balance of the HECM mortgage is greater than the value of the home, the homeowner or the homeowner’s heirs are not responsible for this difference.
The amount a buyer may borrow through the HECM program will depend on the age of the borrower, current interest rates, appraised value of the home, and the Initial Mortgage Insurance Premium. Depending on the buyer’s age, 30 to 50 percent down is required.
“Even though the down payment is higher than one would make for a regular mortgage, it’s a small amount compared to the freedom that you have of no payments in the future,” said Ollie Stolberg, a recent HECM purchaser and homeowner at Maples at the Sonatas.
There are many factors to consider before deciding whether HECM is right for a buyer. To aid in this process, a buyer should visit the Maples at the Sonatas’ sales center in Woodstock and meet with a New Home Consultant. They are able to answer questions, as well as provide educational material for a buyer to consider. In addition, the consultant can refer a buyer to a HECM professional to discuss program eligibility requirements, financial implications and repayment of the loan.
Within Maples at the Sonatas, Epcon Communities offers a variety of attached villa ranch homes and single-family ranch homes set in a maintenance-free community. Maples at the Sonatas also features a well equipped clubhouse with fitness center, kitchen, community room and a heated in-ground swimming pool. The homes provide 1,516 to 2,837 square feet of living space and are base priced from $174,990 to $229,990.
Maples at the Sonatas’ onsite sales center and decorated models are open Monday through Saturday 10 a.m. to 5 p.m. and Sunday noon to 5 p.m. To reach the community, take Route 47 to Ware Road, head east ½ mile, turn left onto Vivaldi, and then turn left on Schumann Road. For more information call (815) 334-0340 or visit the builder’s Website at www.EpconCommunities.com.