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HECM for Purchase Reference Guide

                                   for Realtors and Sellers

        Sales Contract                        Property Types                        Helpful Hints

            Seller must complete all              One to four family,                     Value is the lesser of sales
            FHA-required repairs prior to         townhomes, planned                    price, appraised value or FHA
            closing                               unit development (PUDs),              Lending Limit
                                                  manufactured homes (see
            Signed copy of fully executed         next bullet point) & FHA-             Must occupy home within 60
            contract – all pages                  approved condos                       days of funding

              Amendatory Clause and Real            Ineligible property – co-           “New Construction” - Builder’s
            Estate Certification documents        ops, manufactured homes               rep to get closing statement
            - signed by seller, borrower          produced prior to June                from closed sales and give
            and real estate agent(s)              15, 1975, manufactured                to the appraiser. Since most
              Seller paid fees may be             homes that were installed             builders do not use MLS the
                                                                                        appraiser will need these for
            allowed if common and                 or occupied previously at             the appraisal.
            customary                             another site or location

            No personal property can              Unique properties accepted
            be included – unless it is            on a case-by-case basis
            common to be included –                 99-year leasehold – lease must
            such examples would be                not mature until 50 years
            a stove or refrigerator in a          after the youngest borrower’s
            kitchen                               100th birthday
              No borrowed funds – even if

              No subordinate liens

          For industry professionals only – not intended for distribution to the general public.
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