In a reverse mortgage, the homeowner receives money from the lender, which does not have to be repaid as long as the borrower lives in the home. fannie mae, the largest provider of U.S. home mortgage.
The reverse mortgage loan becomes due and payable as soon as the last original borrower on the loan is no longer living in the home (your step mother). It’s not 6 months later, it is due at that time.
· Perhaps the most appealing feature of a reverse mortgage is that the loan doesn’t have to be repaid until both the borrower and their non-borrower spouse have passed away, sold the property, or moved out of the home. The loan becomes due immediately once these conditions are met and is usually repaid with the proceeds from the sale of the home.
Reverse Mortgage: What Is It and How It Works – A reverse mortgage is a type of home equity loan for older homeowners. lifetime based on a percentage of accumulated home equity. The loan balance does not have to be repaid until the borrower dies.
Answer: Reverse mortgage loans typically are repayable when you die, but may need to be repaid sooner if you no longer use the home as your principal residence, or fail to pay taxes or insurance, or make needed repairs. Most reverse mortgages are Home Equity Conversion Mortgages (HECMs).
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However, there are no limitations regarding how the reverse mortgage proceeds can be used. The loan generally does not have to be paid back until either the last surviving homeowner dies or moves out of the home. After this happens, the estate will sell the home and use the proceeds from that sale to repay the reverse mortgage loan.
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Reverse Mortgage Loans are not subject to prepayment penalties and therefore you can repay any portion of the excess proceeds you received at closing at any time to lower your balance, or you can choose a line of credit and only advance the portion of funds that you wish at closing.
If you are a co-borrower on the HECM reverse mortgage and: But if your co-borrower dies, your loan must be paid off. Warning: If your heirs cannot afford to repay the loan from other funds, your children, other relatives, or unrelated roommates will most likely have to move.