Reverse Mortgage Question

FHA reverse mortgages have a maturity clause stating if you have not lived in the home for 12 consecutive months, then you have to pay off the loan. Their calling the note due gives you an additional 90 days to pay off the loan.. So you should have plenty of time.. Keep in mind the lender does not want the property back.. They only want their money, so it's very likely they will be willing to work within your particular scenario.. I'm a Broker here in Scottsdale AZ and I only lend in Arizona. If you or someone you know is looking for financing options, feel free to contact me or pass along my information. 480-287-5714 WilliamAcres.com

Assuming your reverse mortgage loan is FHA insured, moving out of the house does not automatically trigger maturity (the loan becoming due). The wording in your Note should read that the Lender may require immediate repayment when "All Borrowers cease occupying the Property for longer than 12 consecutive months without the prior written approval of the Lender". That said, if you occupy the house at least one day of any 12 month period, you have satisfied the terms of the Note.Speaking practically, the lender/FHA does not want your house. They would much prefer you or your family sell the house. If you contact the lender and tell them about your situation, they should give you a reasonable amount of time to sell your home, as long as you are working in good faith to sell it. Six months to a year would not be considered unreasonable, again, as long as you are trying in good faith to sell the house.Good luck!

First of all, I hope everything turns out OK so you don't have to even consider the options. FHA notes generally call for the borrower to pay off the loan not more than one year after they stop using the home as their primary residence. If the borrower moves out for medical reasons, but within that one year, moves back in, then if they have to move back out, the clock starts over again. If the note is joint, then as long as one of the borrowers resides in the home, the clock does not start. IF the spouse is not on the note and is at least 62 years old, it is possible for the note to be refinanced with a new reverse mortgage preventing the need for a sale. If there is no spouse and the borrower is going to move out and it is not likely to return, FHA is going to look for repayment before the year is up. As William says, they don't want the property back, but they do want the money. If the balance owed is more than you could get for selling the house, give it back. That's what the Insurance is for. If the home has equity, you may have to lower the price you are willing to accept to prevent the home from being lost to foreclosure. ~ Bert Carpenter, The LoansA2z team of NOVA Home Loans ~ NMLS 40586 ~ www.LoansA2z.com 888-889-9950