March 23rd, 2012 10:16 PM by Juan Luis Rodriguez-Kohly
Today I met a 62+ years old Gentleman at my office who was asking for information for a Reverse Mortgage for his 80+ years old uncle and aunt.
He told me that he had gotten a Reverse Mortgage on his own home when he turned 62, but that his younger wife, had to be taken off Title. The hair in the back of my neck stood up like ...
I asked him if he realized the consequences of such an action. He said that the Loan Originator had told him (or he understood) that if he passed away his wife could stay in the Home for the rest of her life with the Reverse Mortgage. Also, that once the Wife turned 62, she could be added to his loan. Nothing could be farthest from the truth.
This matter is, in my opinion, so grave that I strongly, repeat STRONGLY, advise my borrowers in writing againt doing it, and that they should seek competent legal counsel. I request that both sign it acknowledging they understand. This is done even if the person coming off Title is not a spouse.
UNLESS, the Borrower runs the risk of loosing the home to foreclosure and the funds from the Reverse Mortgage would be enough to pay off the old mortgage. Then it could be considered.
HUD requires that if an owner is coming off Title, that owner MUST participate in the required Counseling session and advise the Counselor of the fact.
IF the Loan Originator said that, it would be in my opinion, grossly negligent. He could have said it out of ignorance or irresponsibility in an effort to make a sale. Either way…
From my own experience I have seen countless times where people hear what they want, not necessarily what is being said. Who knows what really happened.
Why is it so important? 1) Heirs have UP to 1 year to pay off the Reverse Mortgage balance due.Read http://www.HappySeniorHomeOwners.com/AfterDeath
2) Once the Spouse turns 62 years of age, you can NOT add him or her to the current loan. You have to do a new reverse mortgage with all the closing costs, no discount. The balance due on the old Reverse Mortgage MIGHT be too high for the amount that a 62 year old Borrower might get.
If you are thinking of getting a Reverse Mortgage contact me 786-262-6486 or Rodkohly@GMail.com . If you must take an owner off Title, please also consult competent legal counsel
Your comments will be appreciated. Post here or send them to RodKohly@Gmail.com * For most answers call me at 786-262-6486 or visit http://HappySeniorHomeOwners.com (English-Español). To tell a friend visit http://www.happyseniorhomeowners.com/tellfriend.aspx