Reverse Mortgage Q&A

 

WHAT HAPPENS WHEN A REVERSE MORTGAGE MATURES?

DEAR BOB: I am considering getting a senior-citizen reverse mortgage on my home. But what happens after I die? Who makes the decisions concerning the sale of my home such as selecting the real estate agent, asking price, repairs to be made, and whether to "stage" the house for sale? Who makes the decision to accept an offer or make a counteroffer? What if my son does not accept an offer and the house sits empty? What action can the reverse-mortgage holder take? --Frank M.

DEAR FRANK: Presuming your son is your sole heir, if he doesn't cooperate with the lender to pay off the reverse-mortgage balance after your death, the reverse-mortgage lender can hold a foreclosure sale.

Then the lender gets paid the mortgage balance, and any foreclosure-sale excess cash goes to your heir.

However, if your heir wishes to keep the house, he can obtain a new mortgage to pay off the reverse-mortgage balance and then own the house subject to the new mortgage.