Anyone ever short sale a reverse mortgage?
how do you SS a reverse mortgage. A reverse mortgage to my understanding does not goto 100% of the property value and in a reverse mortgage the bank owns the house and you need to pay off the loan by selling the home or paying the bank back the amount owed.
A reverse mortgage is a way for seniors to pull a monthly income from there home which I think they need to have over 80% equity to use.
With a reverse mortgage the bank does not own the house. They simply have a lien on the property that will be settled by the owner’s estate. The estate can sell the house to payoff the loan or allow the bank to take the property as payment in full.
As for SS on a reverse mortgage conceptually I don’t think this is an option. Since there are no payments due on the reverse mortgage during the owner’s lifetime the loan can never go into default. I suppose if the owner decides to sell the property the buyer can make an offer below the loan value but I have never seen this situation.
Owner is in a Sr care facility and her son is handling the property. He told me Wells Fargo holds the reverse mortgage and it has been due for some time. He said she owes 85k but originally it was only 50k…not sure on the specifics.
I was just trying to figure out if there is a way for him to sell it for less than is owed on the reverse mtg. He doesn’t care what it goes for, b/c any profit over the mortgage value has to go to medicare for his mom’s medical bills.
So was just trying to figure out if there is a way I can purchase it for less than the 85k, b/c that is about 85% ARV and not a good deal.
Possible?