what kind of lawyer do i need to take care of a reverse mortgage

Full Answer

Do I need a lawyer to get a reverse mortgage?

If you decide to move forward with a reverse mortgage, a lawyer can also assist you with the necessary paperwork and make sure everything gets done properly and legally. Additionally, if you suspect that your lender has violated the law during your loan process, you can hire a lawyer to explore your legal options.

What is counseling for a reverse mortgage?

Counseling is required for all HECMs. Reverse mortgages are the only financial product (perhaps the only product, period) that require this. Why? Caution.

What to do if your lender is engaging in reverse mortgage abuse?

If you suspect that a lender is engaging in reverse mortgage abuse during the loan process, you should immediately consult with a well qualified and experienced mortgage attorney. An experienced mortgage attorney can determine if the lender has violated the law, as well as help you file a complaint against them.

How can I afford a reverse mortgage?

Utilize a Financial Interview Tool (FIT) to help you determine if you can afford a reverse mortgage and meet your financial obligations, such as paying your taxes and insurance; Draw your attention to alternative options that might be available to you, such as property tax deferral programs;

Who regulates reverse mortgages?

Who regulates reverse mortgage companies? At the federal level, the CFPB, the Department of Housing and Urban Development (HUD), and the Federal Trade Commission (FTC) regulate reverse mortgage lenders' activities. 8 However, a number of states have also passed laws that control how reverse mortgages are advertised.

Who owns the house in a reverse mortgage?

No. When you take out a reverse mortgage loan, the title to your home remains with you. Most reverse mortgages are Home Equity Conversion Mortgages (HECMs).

How do you settle a reverse mortgage?

Here are the options for paying off a reverse mortgage before or after the borrower's death.Sell the house and pay off the mortgage balance. ... Sell the house for less than the mortgage balance. ... Provide lender a deed in lieu of foreclosure. ... Have a child take out a new mortgage on the house after your death.More items...•

Can heirs walk away from reverse mortgage?

Allow foreclosure: Heirs are not held responsible for a reverse mortgage loan and can walk away from the property without owing anything. As mentioned earlier, if the home is worth less than the loan amount, that is the lender's responsibility and why a borrower pays into a federal insurance fund.

Can a family member take over a reverse mortgage?

Unfortunately, however, you can't add a family member to an existing reverse mortgage.

How long do heirs have to pay off a reverse mortgage?

Upon the death of the borrower and Eligible Non-Borrowing Spouse, the loan becomes due and payable. Your heirs have 30 days from receiving the due and payable notice from the lender to buy the home, sell the home, or turn the home over to the lender to satisfy the debt.

Can you sell a house with a reverse mortgage on it?

Can you sell a house with a reverse mortgage? A reverse mortgage is a mortgage loan that can be repaid at any time without penalty. Therefore, the answer is yes: a borrower can sell a home with a reverse mortgage at any time they choose, just like a traditional mortgage.

Can you sell a property with a reverse mortgage?

Yes, you can sell a house with a reverse mortgage. Your lender cannot force you to sell the home, but you are able to sell it at any time if you choose to do so. However, keep in mind that when you sell the home, your reverse mortgage comes due — and you'll need to pay off the loan balance, plus interest and fees.

What Suze Orman says about reverse mortgages?

Suze Orman on her CNBC show recently responded to a viewer question by stating that a reverse mortgage is a better option than selling stocks.

Can a reverse mortgage go into foreclosure?

A reverse mortgage foreclosure is when a lender requires full repayment of a reverse mortgage loan balance due to a “triggering event,” such as the death of all of the homeowners. However, there are other common events that can lead to a reverse mortgage foreclosure.

What happens if you can't pay a reverse mortgage?

Home Equity Conversion Mortgages (HECMs), the most common type of reverse mortgage loan, require that you keep current on your property taxes and homeowners insurance. Failure to pay either may lead to foreclosure.

How long can you live in a house with a reverse mortgage?

six monthsHow Long Can I Be Away From Home With a Reverse Mortgage? The rules state that you must live at a property for the majority of the year for it to qualify as your principal residence. This means that you can't be away for more than six months at a time for nonmedical reasons.

There is no need to engage a reverse mortgage by HUD or lender standards but only you can determine ...

There is no need to engage a reverse mortgage by HUD or lender standards but only you can determine whether you feel you need legal or accounting a...

How long can you leave home with a reverse mortgage?

The loan terms allow you to be out of the house each year for a portion of the year as long as you live in the home for more than 6 months of the y...

Do both spouses have to be 62 to get a reverse mortgage?

Do both spouses have to be 62 to get a reverse mortgage? In most states, only one spouse needs to be 62 or over and the younger spouse can be under...

What happens if a spouse dies with a reverse mortgage?

The loans remains in place as long as at least one borrower on the original loan or an eligible spouse remains living in the home.

Who holds title in a reverse mortgage?

The reverse mortgage is a loan like any other loan. The borrowers still hold title and have a lien (loan) on the property just as they would with a...

Understanding Mortgage Modifications

Before you can figure out if you should hire an attorney to help you with a mortgage modification, you must first understand the basics about modif...

When You Should Consider Hiring An Attorney to Help With Your Mortgage Modification

Below are some situations where you should consider hiring, or at least consulting with, an attorney.

When You Might Not Need An Attorney to Help With A Mortgage Modification

The following are a few situations where you probably don’t need to hire an attorney to assist with the modification process.

1 attorney answer

There are attorneys that handles these issues. These can be facts sensitive issues. Based on the limited facts you gave, it sounds as though your mom may have missed her tax payments or somehow it was not recorded properly and the county sold a tax lien. These are time sensitive issues...

Timothy Farnsworth Coons

There are attorneys that handles these issues. These can be facts sensitive issues. Based on the limited facts you gave, it sounds as though your mom may have missed her tax payments or somehow it was not recorded properly and the county sold a tax lien. These are time sensitive issues...

Who is the CEO of All Reverse Mortgage?

Michael G. Branson CEO, All Reverse Mortgage, Inc. and moderator of ARLO™ has 40 years of experience in the mortgage banking industry. He has devoted the past 16 years to reverse mortgages exclusively.

How long can you stay in a house with a reverse mortgage?

How long can you leave home with a reverse mortgage? The loan terms allow you to be out of the house each year for a portion of the year as long as you live in the home for more than 6 months of the year and if you are gone for more than 60 days, you notify the lender and secure the home while it is vacant.

Can a husband and wife reverse mortgage be changed?

At the time of applying for the reverse mortgage, title to the residence was held as “husband & wife, as community property with right of survivorship,” a customary form of joint title in California. The reverse mortgage loan closed in mid-2017 with wife as the only borrower. Husband has now died, and title cannot be changed back community property ...

Does HUD change the final rule?

To answer another of your later questions, HUD did in fact change that rule when they issued their “Final Rule” later that year (September of 2017). Non-borrowing spouses and others on title no longer have to come off title to close a reverse mortgage as long as they sign the proper paperwork now.

Do you have to pay prepayment penalty on a mortgage?

The borrowers still hold title and have a lien (loan) on the property just as they would with a standard or forward mortgage. There is no prepayment penalty and so the loan may be prepaid at any time without penalty and that includes by sale, refinance or with other funds available to the borrower.

Is there a law that removes a borrower from title?

There was never a “law” regarding removing borrowers from title, HUD simply had rules regarding what they would allow for the program and then it was up to borrowers to agree to abide by the rules to accept the loan terms or they could refuse but then they would not be eligible for the loan.

Why do you need an attorney to get your home back after foreclosure?

Because it's very difficult to get your home back after a completed foreclosure, you want to deal with violations of loss mitigation laws before the sale . Having an attorney on your side gives you a better chance of getting results before your home is sold.

How to get a mortgage modification?

Hiring an attorney may be a good idea if you want a mortgage modification, but you don't understand the application process or have a complicated situation. For example, it might be worthwhile to hire an attorney if you've spoken to your loan servicer about a modification but are confused about: 1 how to fill out the application 2 what documentation you need to submit along with an application, or 3 how to explain your financial hardship or situation in the application.

What happens if a servicer violates state law?

If your servicer violates state law while foreclosing on your home, your attorney might be able to use the violation or violations as leverage in getting you a loan modification. Keep in mind that servicers often make mistakes when servicing loans and in the foreclosure process. A lawyer could uncover errors that you won't even notice.

How long can a servicer be delinquent on a loan?

For example, under federal law, the servicer generally can't start a foreclosure until you're more than 120 days delinquent on the loan.

What happens if a servicer denies a modification?

If the servicer denies your modification request, in many cases, you'll also get some time to make an appeal. An attorney might be able help you in showcasing why the servicer made an error in denying your application so that you're more likely to get approved for the modification in your appeal.

What to do if you have difficulty with foreclosure?

Ultimately, if you find yourself having difficulty with the application or your servicer isn't abiding by the law, you should consider consulting with a qualified, reputable foreclosure attorney who can help you with the process.

What to do if you aren't sure what to do?

If you aren't sure what to do—say you're facing foreclosure, but you aren't sure if a modification is right for you—and want to know about all of your options, an attorney can help you understand your legal rights and give advice about the best course of action in your situation.

How long does reverse mortgage counseling take?

Best case scenarios indicate that scheduling a counseling session will take three to ten business days from the time you place the call to the counseling agency. Reverse mortgage “counseling” is not therapeutic or psychological counseling.

What is a printout of a reverse mortgage?

A printout of loan comparisons, so the counselor may review what you are potentially eligible to receive from the reverse mortgage. A printout of the Total Annual Loan Cost (TALC) Disclosure required by the Federal Reserve Board on all reverse mortgage transactions.

Can a loan originator direct you to a counselor?

Loan originators are not permitted to direct you to a specific counselor or counseling agency. Instead, they are required by HUD to provide a list of counselors, including local agencies and national intermediaries who are selected by HUD to provide counseling by telephone across the country.

Do you need counseling for a reverse mortgage?

Counseling is required for all HECMs. Reverse mortgages are the only financial product (perhaps the only product, period) that require this. Why? Caution. Because reverse mortgages are designed for an older audience who are often on fixed incomes and involves what is usually everyone’s most valuable asset—their home—government and the reverse mortgage industry want to make sure you have all the information you need to make the right decision. A counseling session can take place either face-to-face or by telephone. Counselors have been trained to deliver the required information either way. The session should generally last 90 minutes but can take longer as needed.

How does a reverse mortgage work?

In a regular mortgage loan, the borrower gets a lump sum from the lender and makes monthly payments towards paying the money back, plus interest. With a reverse mortgage, instead of getting an upfront amount that the borrower has to repay steadily, the borrower typically gets periodic payments, ...

What happens if a borrower dies on a reverse mortgage?

If a borrower who took out a reverse mortgage dies, the heirs have several options for dealing with the debt. If you take out a Home Equity Conversion Mortgage (HECM)—the most common type of reverse mortgage—the loan becomes due and payable under specific circumstances, like when you die. Your heirs will then have several options ...

How to keep a home with a HECm?

With a HECM, under HUD regulations and guidelines, the heirs may keep the home by paying the mortgage balance or 95% of the current appraised value of the property, whichever is less. 2. Sell the home. The heirs can sell the home and use the sale proceeds to repay the reverse mortgage loan. With a HECM, heirs may sell the property for the lesser ...

What happens to a borrower's property after he dies?

After the borrower dies and the property is not the principal residence of at least one surviving borrower, the heirs can deal with the debt in one of the following four ways.

Can a lender get a deficiency judgment after foreclosure?

These options are explained in more detail below along with a brief explanation about how reverse mortgages work. HECMs are nonrecourse, which means that the lender can’t get a deficiency judgment after a for eclosure or deed in lieu of foreclosure.

Can heirs sell a house?

The heirs can sell the home and use the sale proceeds to repay the reverse mortgage loan. With a HECM, heirs may sell the property for the lesser of the loan balance or 95% of the appraised value of the home.

Can heirs sign over title to house?

The heirs can sign over the title to the home to the lender with a deed in lieu of foreclosure. Giving the property to the lender will satisfy the debt and avoid a foreclosure. 4. Do nothing and let the lender foreclose. The heirs can let the lender foreclose.

How does a reverse mortgage work?

How Reverse Mortgages Work. An appraisal determines the value of your home. The value of your home is an important part for determining if you qualify for a reverse mortgage. Your qualification and loan amount is determined primarily by the value of your home, the amount you owe on the home and your age. However, to qualify for the loan, your home ...

What age can you get a reverse mortgage?

The most common reverse mortgage, known as the Home Equity Conversion Mortgage, enables homeowners age 62 and older to access their home equity. The funds, or loan proceeds, received from the reverse mortgage are non-taxable and may be used without restriction to cover personal living expenses, such as health care costs or home repairs.

Why do you need an appraisal for a reverse mortgage?

Home appraisals are essential to your prospects of getting a reverse mortgage. When an appraiser visits your residence, not only will he or she assess the current market value of your home, but also the physical state of your property.

What are the factors that affect the amount of reverse mortgage?

The amount of proceeds you are eligible to receive from a reverse mortgage depends on a number of factors, including your age, current interest rates and the appraised value of your home. The funding amount of your reverse mortgage can also be impacted depending on the magnitude of repairs needed for your home, if any.

What happens if your home doesn't meet HUD standards?

In the event that an appraiser reveals certain property defects with your home, you are then required to hire a contractor to complete the repairs.

Can reverse mortgages help older people?

One of the biggest draws for reverse mortgages is their ability to help older adults remain in their homes, while also providing them with some additional cash flow via their home equity. But while not everyone’s home may be physically equipped to suit their aging needs, certain features of reverse mortgages can help cover some much-needed repairs ...

Closing a reverse mortgage

Closing is the final step of the reverse mortgage process. At closing, you and other parties involved, such as a loan officer and closing agent, meet to finalize the transaction and sign the necessary paperwork. This step can also be referred to as signing or settlement.

What is the reverse mortgage closing process?

Like a traditional mortgage, there are certain steps you must execute to be able to sign your loan and start receiving funds. To get to closing, here are the steps you’ll have to complete:

How long does it take for a reverse mortgage to close?

Closing a reverse mortgage can range between a few business days to 21 and 45 days. However, depending on your circumstances, it may take longer to complete. The process can take a significant amount of time because you have to gather important paperwork and different parties need to be contacted.

Reverse mortgage closing documents

To close your loan, here’s a list of the reverse mortgage closing documents you’ll need:

Final notes

Closing the reverse mortgage process is an exciting time for many senior homeowners. However, without the correct documents, you may not be able to close or have to take longer than expected.

Why do people need debt lawyers?

Those people are seeking help from debt lawyers to fight back against aggressive debt collectors in court. If a debt collector is relentless in trying to recover money you owe, a debt lawyer is a good resource to help you understand your rights and provide a path to escape harassment or illegal tactics.

What is debt lawyer?

A debt lawyer is someone with the knowledge, credentials and skill to help consumers struggling with debt sort through their financial troubles. Representing clients in cases against debt collectors is a form of consumer law, the branch dedicated to protecting consumers against unfair trade and credit practices.

What do debt attorneys do in bankruptcy?

With a bankruptcy, a debt attorney will help you prepare all the required paperwork you need in your case. They can answer your questions and give you a basic rundown on rules and procedures in the courtroom.

Why are debt lawyers so popular?

Debt lawyers have become more prominent because household debt in the U.S. has jumped 11% over the last decade to an average of $134,643 (including mortgages) and credit card and auto loan debt are going over the $1 trillion, mark.

How to stop debt collectors from calling?

Here are some common reasons to seek legal advice: 1 Debt collectors are calling you at home or work all the time. If you’re getting a lot of calls and can’t stop them with a request that the debt collectors desist, it might be time to bring in an attorney who can discuss your rights and speak to the creditors contacting you. 2 You’ve reviewed your finances with the help of a nonprofit debt counselor and have concluded that you are unable to repay your loans. 3 A creditor is threatening you with a lawsuit or has filed suit. 4 Debt collectors are treating you in a way that you feel is abusive. 5 Your creditor has repossessed your car and might be threatening you with a collection suit.

Do debt settlors use lawyers?

In other instances, debt settlors use lawyers as fronts to draw business. Then the lawyers disappear and you’re dealing with a debt settlor who might not offer the kind of help you were seeking. Make sure you’re dealing with a lawyer if you need legal help. About The Author.

Can a lawyer file a counterclaim against a creditor?

Perhaps you have grounds for a counterclaim against the creditor. If the creditor violated legally prescribed procedures for collecting debt – say the credito r illegally harassed you – a lawyer might be able to file a counterclaim against the creditor. There are also standard legal defenses that could work.

What does a real estate attorney do?

Real estate attorneys sometimes handle additional parts of the home purchase like title searches and title insurance, to ensure there are no outstanding claims or liens against the property. They may also provide documentation of the transfer of funds to the seller and to your lender, or facilitate the transaction as a third party.

What states require an attorney to take care of a notary?

If you are buying a home in certain states, including Connecticut, Delaware, Georgia, Massachusetts, New York, North Carolina, South Carolina and West Virginia, ...

Do I need a lawyer for real estate?

In states where it's customary or required to have a lawyer, your real estate agent likely has recommendations too. Check your attorney's credentials with your state's bar association to ensure they are in good standing. (State bar association websites can also help you find real estate lawyers near you.)

Can I go to court for a home purchase?

For the purposes of most home buyers, purchasing real property doesn't involve going to court. Instead, a real estate lawyer may prepare or review all of the documents related to your home purchase, including the contract, any additional agreements made with the seller, documents from your lender, and title and transfer documents. ...

Do you pay real estate attorney fees?

Real estate attorney fees are generally paid as part of your closing costs. You'll see it on your loan estimate document under "services you can shop for," since it's not a set cost. The estimate given in the loan estimate can change depending on the attorney you hire and your legal needs.