Borrower will be listing their current home. They want to downsize and found the perfect home but, will need to make the offer ASAP. He will be using his investment securities for the down payment. Will there be any problems with him still owning current home and borrowing from his securities?
They can purchase a new home if they can provide a copy of the purchase contract or MLS listing on the current home before closing. If the current home has an FHA loan on it, they must sell it before or concurrently with the new loan. If the homes are near each other they must write a detailed letter explaining why they are downsizing, along with signing an owner occupancy disclosure. Borrowed funds are not allowed on HECM loans, they can liquidate assets to purchase the home but, borrowing funds are not acceptable.