Foreclosure Danger Reverse Mortgage Holders Face
Q: My grandparents are thinking about getting a reverse mortgage. Is it true they can lose their home after getting a reverse mortgage? Helen, Bridgewater, NJ
A: The simple answer to your question is yes. If at any point during the loan period a reverse mortgage holder becomes delinquent on property taxes, homeowner’s insurance or HOA fees it could result in a default that could trigger a foreclosure action against the reverse mortgage holder. In addition, since one of the terms of a reverse mortgage is that the homeowner is required to live inside the home as their principal residence for most of the year, if the reverse mortgage holder spends the majority of the year living outside the property (i.e. in a nursing home or assisted living facility), it could also trigger a foreclosure action against the reverse mortgage holder. Thanks for your question, Helen.
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