• Question
  • reverse mortgage on vacant land

    Asked on 12/5/2012

    If a piece of vacant land in a residential neiborhood is fully paid for, can you have a "reverse mortgage" on vacant land? If so, how do you go about doing it?

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  • Categories: Reverse Mortgages, Qualifying

Answers

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  • No. Reverse Mortgages can only be done on homes. In fact, the Reverse Mortgage borrower must live in the home in order to qualify for the loan.

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  • Login to rate this answer:   Answered on 12/6/2012
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  • You can build a house on the vacant land, and then get a Reverse Mortgage, but you can't get a Reverse Mortgage on vacant land by itself.

    A few years ago I had a client who used a Reverse Mortgage like that. I provided his bank with a "take out" letter, so he could get a construction loan to build the house. And we started to refinance the Construction Loan into the Reverse Mortgage when the drywall started going up. The Reverse Mortgage funded around the same time he got the permits to move in.

  • Login to rate this answer:   Answered on 12/7/2012
**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.