Numerous horror stories regarding reverse mortgages have forced the Department of Housing and Urban Development (HUD) to take another look at its current policy. Changes have been made, allowing reverse mortgage lenders to transfer certain loans to HUD when a borrower dies and is survived by a non-borrowing spouse.
Prior to this change, the surviving spouse who was not listed as a borrower had to leave the home. Now, loan servicers have a new option. For many couples, it is risky to own a residence where only one spouse in on the mortgage. If that spouse dies and they have taken out a reverse mortgage, strict guidelines come into play.
A recent widow faced loosing her home after her husband took out a reverse mortgage and then passed away shortly thereafter. The reverse mortgage was only in the deceased spouse’s name, despite the couple jointly owning the property. Reverse mortgages are only available to those 62 years of age and older. At the time of the reverse mortgage, only the woman’s husband met the age requirement.
Such dealings can become complex but with the policy change, the government hopes to alleviate this. Under the revised policy, lenders will be allowed to proceed with reverse mortgage claims, known as home equity conversion mortgages (HECM). This can only be done with eligible surviving non-borrowing spouses and case numbers assigned before August 4, 2014. It is recommended that a reverse mortgage not be taken out unless both spouses can be on the loan agreement.
Choosing the right attorney can make the difference between whether or not you can keep your home. A well-qualified Miami foreclosure defense attorney will not only help you keep your home, but they will be able to negotiate a loan that has payments you can afford. Miami foreclosure defense attorney Timothy Kingcade has helped many facing foreclosure alleviate their stress by letting them stay in their homes for at least another year, allowing them to re-organize their lives. If you have any questions on the topic of foreclosure please feel free to contact me at (305) 285-9100. You can also find useful consumer information on the Kingcade & Garcia website at www.miamibankruptcy.com.
Source:
http://www.miamiherald.com/living/home-garden/article25519939.html
http://www.consumeraffairs.com/news/feds-ease-reverse-mortgage-policy-for-non-borrowing-spouse-again-061515.html