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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

Thanks Adonis!

So are you saying that even though my dad gives back the house, he's still responsible for maintenance and property taxes until the mortgage company decides to sell it? Or is my dad off the hook as soon as he returns the house to them?

Thanks again..
Posted on: 01st Sep, 2010 06:51 am
Hi dropframe!

Welcome to forums!

Once your father's name is removed from the property deed, he won't be liable for any property maintenance fees or taxes.

Sussane
Posted on: 02nd Sep, 2010 02:21 am
my paren'ts are both deceased. they had a reverse mortgage. Can I get any of the equity thats left out of the house?
Posted on: 16th Sep, 2010 01:00 am
My grandparents had a reversed mortgage. My grandmother passed first 1/09 and my grandad 5/10. We were living with them for years. Now the lender is giving us 6 months to either refinance, sell or deed home to lender. I cant refiance(credit). My grandfather's child from previous marriage had become personal rep. to clear up a insurance beneficary issue(grandma didn't list 2nd benificary, so his biological daught had to become PR to claim)but nothing dealing with the house. being as tho she became PR, if home forcloses will they come after her for repayment. She knows nothing of the house situation and I don't think she cares. She was very distant from the family. or is there another solution, b/c well be homeless?
Posted on: 16th Sep, 2010 01:41 pm
Hi!

Welcome to forums!

To bspczz,

The lender will sell off the property in order to get back his mortgage payments. After his debt is satisfied, if there is an excess amount, then you can claim it.

To Mika,

The lender will not come after the daughter for any payment. You can deed the property to the lender who will sell it off. He will be able to recover whatever amount he receives form the property sale.

Feel free to ask if you've further queries.

Sussane
Posted on: 17th Sep, 2010 03:18 am
If I let a reversed mortgage forclose and I'm personal rep. will lender come after me/sue me for the loan or because its a FHA loan, will they just write it off. We have been living with my grandparents for years and suddenly have to move because of there passing. Another year which is a given for a foreclosure, will give us time to save and build credit to move. Please Help!!!!!!
Posted on: 28th Sep, 2010 10:17 am
hi teena,

the lender won't be able to come after you to recover any deficient balance resulting from the sale of the property. as your grandparents have deceased, you can refinance the existing reverse mortgage if you wish to save the property. if you don't wish to save the property, then you can let the lender sell off the property.

thanks
Posted on: 28th Sep, 2010 11:16 pm
My parents have a reverse mortgage on their home and now want to sell due to my Dad's failing health. They would like to move to a senior living apartment near me.(across the country from their current home) Can they put the house up for sale and move into the apartment near me now or do they need to stay in the house until it sells?
Posted on: 04th Oct, 2010 07:19 pm
Hi Jlynn,

Your parents can list the property in the market and move into an apartment near you. They don't have to stay in the property until it sells off.

Thanks,

Jerry
Posted on: 05th Oct, 2010 03:02 am
If I let a reversed mortgage forclose and I'm personal rep.(I can't sell because area is upside down and I can't refinance b/c of credit)will lender come after me/sue me for the loan or because its a FHA loan, will they just write it off. We have been living with my grandparents for years and suddenly have to move because of there passing. (Another year, which is a given for a foreclosure, will give us time to save and build credit to move). If I don't deed back to them will they come after me, when they foreclose? Please Help!!!!!!
Posted on: 06th Oct, 2010 10:43 am
Hi Teena!

Welcome to forums!

If you cannot refinance the reverse mortgage, the lender will simply foreclose the property in order to recover the dues. He won't be able to come after you for the deficient amount resulting from the foreclosure. You will have to deed back the property to the lender if you cannot refinance the reverse mortgage into a conventional loan.

Feel free to ask if you've further queries.

Sussane
Posted on: 07th Oct, 2010 02:38 am
My stepfather has a reverse mortgage on his home . He is now close to or past the point of being underwater as far as current market value of the home vs the loan balance. I know that when he eventually passes or the time comes when he can't continue living in the home the lender has to take whatever the home sells for as full payment, even if the loan balance is less than what a good faith effort brings in a sale . My question is, is there a time limit on how long the home can sit on the market before being foreclosed on, and what other options are there? He lives in a depressed area of rural DE, and myself and my sister are co-executors of his estate, and since we live 1,000s of miles away in AZ and CA respectively, we're not interested in trying to hang on to the property for a minute longer than necessary.
Posted on: 05th Dec, 2010 08:19 pm
If my mom gets a reverse mortgage to get rid of her home equity payment, can I repay the mortgage early before she passes and I inherit the home?
Posted on: 15th Feb, 2011 07:30 am
Hi Steven,

Once your step-father moves out of the property which has a reverse mortgage on it, he can surrender it to the lender and ask him to foreclose it immediately. The lender will place the property in the market in order to find buyers for it. It might take some time to complete the foreclosure sale of the property.

To Wesley,

You can pay off the reverse mortgage in full or refinance the mortgage in your name in order to inherit the home and save the property.

Thanks
Posted on: 15th Feb, 2011 10:44 pm
If you rent your house to a relative is that wrong with a reverse mortage?
Posted on: 21st Mar, 2011 03:57 pm
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