To Sell or to Reverse?

by : Michael Branson

Many people are not aware of all the opportunities available to senior borrowers with the Reverse mortgage program. For example, did you know that HUD does not require any title seasoning or seasoning for time off the market when doing a Reverse Mortgage? What exactly does this mean to senior borrowers? It means a lot if you listed a home thinking that you could not keep it but you really did not want to sell your home.

As an example, we had a borrower who was 73 years old and loved her home. She was active and had lived in her home for over 20 years and had raised her family there. The home's value is $365,000 and her then current mortgage of right around $200,000 was taking everything she could scrape together every month plus savings to pay since her husband had died. Her two children were raising their own families in this tough economy and were unable to help mom out.

She hated the thought of selling, but felt that selling the home would be the only way she would be able to get out without losing the home to foreclosure because her payment with taxes, and insurance was more than her social security payment and she was going into her small savings monthly to make the payments and for other living expenses. She knew the savings would not last long at this rate so she consulted with a real estate sales person and sadly listed her beloved home.

After several months on the market and no offers, the sales agent was already talking about a price reduction. It was at the urging of her daughter that she contacted us after her daughter heard about Reverse Mortgages from a friend. The borrower qualified for enough money to pay off her current mortgage, to also receive about $40,000 cash on top of the loan payoff and all with never having to make another mortgage payment.

In this case, the borrower's needs were much better met with a Reverse Mortgage than selling her home. So if you or a loved one aged 62 and over are thinking of listing a home but that is not what you really even want to do, but think you have to, you owe it to yourself to look into all the alternatives available. Just remember, HUD will even allow you to obtain a Reverse Mortgage if your home has recently been on the market under the right circumstances!