Corona Reverse Mortgage Question - Who Gets My Home When I Die?

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Mortgage and Lending with Orange County, Corona, Riverside, Los Angeles NMLS#203003

Corona Reverse Mortgage Question - Who Gets My Home When I Die?

Your heirs do!  Contrary to the very common myth, the bank does not own your home - you do. A reverse mortgage is just a loan against the home like any other mortgage.  The major difference is that usually on a reverse mortgage the payoff amount is higher than what you originally borrowed because of accrued interest.*    

The loan becomes immediately due and payable upon the death of the last remaining borrower, but the lender cannot start foreclosure proceedings (based upon said death) until 6 months from the date of death.  

If the loan balance is lower than the home value, then the heirs will most likely choose to sell the property, payoff the loan and keep the change.  However, they may also decide to pay the loan off with cash, or refinance the loan.  It’s entirely up to them.

If the loan balance is higher than the value of the home (underwater) then don’t panic.  Reverse mortgage loans are non recourse loans, meaning that if the lender suffers a loss upon foreclosure and sale of the home they do not have any recourse to the estate, borrower, or heirs.  The lenders only option is to sell and take the proceeds as payment in full.  The lender then may qualify for a claim of loss on the FHA Mortgage Insurance that was purchased on the loan.  It’s all good.

Leaving something to your children is an important component to feeling like you’ve lived a successful life, but more important is leaving your children with the tools to be successful in their own lives.  Education, confidence, independence and love.  A reverse mortgage is a financial tool that may help you to live a more financially secure life.

*Balance due will include all upfront fees, loan proceeds, draws plus interest.

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By Deborah Nance

NMLS#202003

Your Local Southern California Reverse Mortgage Professional

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Equal Housing Lender

iReverse Home Loans, LLC, NMLS#810502 originates reverse mortgages in Alabama, Alaska, Arizona (MB-0919584), California, Colorado, Connecticut, Florida, Illinois, Indiana, Iowa, Kansas, Louisiana, Maryland, Massachusetts, Minnesota, Mississippi, Missouri, Nevada, New Jersey, New Mexico, Ohio, Oregon (ML-5378), Pennsylvania, South Dakota, Tennessee, Texas, Utah, Vermont (1164-MB), Virginia, Washington and Wisconsin. 

Important Information: Reverse Mortgages are neither "endorsed" nor "approved" by the Federal Government. The FHA (Federal Housing Administration) provides certain insurance benefits for lenders and borrowers in connection with the lender’s HECM loans; the FHA does not make or originate loans. The owner(s) retain title to the property that is the subject of the reverse mortgage until the person sells or transfers the property and is therefore responsible for paying property taxes, insurance, maintenance and related taxes. Failing to pay these amounts or failure to maintain the condition of your property may cause the reverse mortgage loan to become due immediately. A reverse mortgage is a complex loan secured by your home. Whether such mortgage makes sense for you depends on your financial situation and needs. For these reasons, we strongly recommend that you consult with a qualified independent housing counselor, family members and other trusted advisers before making this decision. This website is not from HUD or FHA and was not approved by HUD or any government agency.

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Lending / Financial
Location:
California Riverside County Corona
Groups:
Seniors Issues
communities for those 55 and better
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reverse mortgage faq

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Deborah Nance

Southern California , Reverse Mortgage Specialist
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