Deciding between staying in your home with a reverse mortgage or selling and downsizing is one of the biggest retirement housing choices many people face. There's no single "right" answer — it depends on your goals, finances, and how you want to live. Here's a straightforward look at the tradeoffs so you can think it through.
The True Cost of Selling and Moving
Downsizing isn't free. When you sell, you typically pay real estate commissions (often 5–6% of the sale price), closing costs, and moving expenses. You may need to buy or rent a new place, which can mean a new mortgage or monthly rent. There are also less visible costs: the emotional toll of leaving a neighborhood, friends, and memories; the stress of decluttering and packing; and sometimes the reality that a "smaller" home in a desirable area isn't much cheaper. When you run the numbers, the net cash from a sale can be less than you expect, especially after you pay for the next place to live.
When Downsizing Makes Sense
Downsizing can be the better choice if you want to leave your current area, reduce maintenance and stairs, be closer to family, or lock in a chunk of equity for savings or other goals. It also makes sense if your home is too large, too expensive to maintain, or if you don't plan to stay long. In those cases, selling and moving may give you more flexibility and a simpler financial picture.
When Staying Put With a Reverse Mortgage Makes Sense
A reverse mortgage can be a better fit if you want to stay in your current home, eliminate or reduce monthly mortgage payments, and access equity without selling. It's especially useful when you have strong ties to your community, your home is already set up for you, and you'd prefer not to go through a move. Many people use a HECM to pay off an existing mortgage and create a line of credit that grows over time as a safety net — without giving up the house. You can see how much you might access with our calculator.
HECM for Purchase as a Middle Ground
You don't have to choose only between "stay forever" or "sell and downsize." HECM for Purchase lets you buy a new home with a reverse mortgage — often after selling your current one — and never make a monthly mortgage payment on the new place. So you can downsize or relocate and still avoid a new traditional mortgage. Your down payment (from the sale of your previous home or other funds) plus the HECM covers the purchase. It's a option worth considering if you want a different home but not a new monthly payment.
Comparison at a Glance
| Reverse mortgage (stay put) | Downsizing (sell & move) | |
|---|---|---|
| Stay in current home | Yes | No |
| Monthly mortgage payment | None (after payoff) | Depends (rent or new loan) |
| Access to equity | Line of credit, lump sum, or payments | Equity in hand from sale |
| Costs | Closing costs, MIP (often financed) | Commissions, moving, new housing |
| Emotional factor | No move | Move and life change |
For more on how reverse mortgages work in general, see our homeowner guide and FAQ. If you'd like to talk through your situation — staying put, downsizing, or HECM for Purchase — I'm here to help with clear information and no pressure.
Have questions about reverse mortgages or want to see how much you might access? Try our calculator or schedule a conversation with Jerry.