To maintain your Reverse Mortgage, you must reside in that property.
If you wish to relocate (and rent out your current home), you will need to pay off your Reverse Mortgage. You should contact your Reverse Mortgage lender for more information about terminating your agreement.
You should also investigate whether or not you qualify for a forward mortgage on your property. Many seniors do not have the income necessary to qualify for forward mortgages.
This is nothing more that a traditional refinance. The only difference is that the existing mortgage is a reverse mortgage. In any refinance the existing lien holder (in this case your reverse mortgage) will be contacted to determine the "pay off" for that loan. Your new traditional loan will pay off the existing reverse mortgage. The only differences now is that 1) you will be needing to make a payment on this new traditional loan 2) the occupancy of the property for this refinance will be an investment property rather than a primary residence since you will have renters.
I hope that this helps!
Not to complicate matters but you may want to also research the Fannie Mae Home Keeper for Home Purchase program as an option.
One interesting feature of the Home Keeper is that you can use the program to purchase a new home – all in a single transaction. The transaction reduces the out-of-pocket cash needed to buy a new home, eliminates any new monthly mortgage payment, and helps you keep more of the sales proceeds from the old house – or a larger amount of savings – to use for other purposes.
When the Modernization Act goes into force, HECM for Home Purchase will also be available. The Homekeeper program unfortunately usually doesnt give you enough money to make it worthwhile. I would be happy to run an estimate to see how much would be available.
You might be able to get a significant sum of money from the HECM for Home purchase, use it towards the payoff of your existing reverse mortgage and only have to finance a smaller amount of money on the new rental :)
I am a Reverse Mortgage Specialist employed by Financial Freedom. Let me know if you have further questions :)
tfield @ financialfreedom.com
**All above answers are provided as general information only. No warranty is made regarding the fitness or accuracy of the information provided in this answer. You should seek advice from a licensed CPA, attorney or CERTIFIED FINANCIAL PLANNER™ as to your unique financial situation.