Under what circumstances would a reverse mortgage become due for payoff?
One is when the last borrower moves out for more than a year, passes away or the home is no longer their primary residence. Another scenario would be if the property taxes or homeowner’s insurance were not kept current, or if the home is not maintained to minimum safety standards. Once the loan is due, you or your heirs would then have six months to either sell or refinance the property, with two possible three-month extensions. You or Your heirs can sell the home, payoff the mortgage and then keep the remaining balance.
Alternatively, your heirs can opt to refinance the mortgage and move in or rent out the property. In the event that the loan balance is higher than the value, your heirs can purchase the home or sell it for 95% of the then current appraised value… and FHA mortgage insurance will make up the shortfall. But, under no circumstances can you outlive the reverse mortgage, because the term is the youngest borrower’s 150th birthday!
To find out more, call me, a C2 certified reverse mortgage specialist, today.
Steve Mitchell
Reverse Mortgage Lender
Monterey CA
