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When to pay back reverse mortgages

Posted on: 26th Mar, 2004 03:54 am
Reverse mortgages are payable only when the last surviving borrower dies, sells the property, permanently moves out or when he reaches the end of the loan period. A permanent move is implied when you, the co-borrower, or a qualifying relative has occupied the home for at least 1 year. If you die, the lender will not be able to take the title if your heirs can repay the loan.

When the loan may be in default


The loan will be in default if:
  • You or the co-borrower have filed bankruptcy.

  • The borrower donates or abandons the home

  • You haven't paid property taxes

  • You haven't maintained your home or paid for repairs

  • Your home is no longer insured
Moreover, if the loan has an acceleration clause , the lender may require you to pay down the mortgage if:
  • A co-owner has been added to the property title

  • You have rented out the property to a non-relative

  • You have taken a new loan on your home

  • You have changed the property's zoning classification
Make sure you check the loan documents so you know what situations will cause your loan to default and your repayments to accelerate.
Related Articles

Hi Guest!

Welcome to forums!

If you rent such a property and if the reverse mortgage lender comes to know about, he will immediately call the loan due. If the landlord cannot pay off the loan, then the property will be in jeopardy as the lender will take steps to foreclose the property.

Feel free to ask if you've further queries.

Sussane
Posted on: 27th Feb, 2013 10:02 pm
We reported the landlord to their mortgage company. But the landlord is trying to evict us and get back in to the house before the mortgage company find them not in the home. They used the fact that they have a reverse mortgage as a reason to evict us. We are fighting the eviction because of so many issues regaurding the paper work and notices given. But We would like to know if we could purchase the home when the reverse mortgage takes action against the landlord?
And can we sue for our rent money back because they rented to us when they we not suppost to? they double dipped getting money from the mortgage company and then from us for the same house.
Posted on: 02nd Mar, 2013 08:13 pm
Hi Guest,

If the reverse mortgage lender takes action and the property is put up for sale, you can purchase it if you meet the required criteria.

Thanks
Posted on: 03rd Mar, 2013 11:38 pm
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