Preserving the Heirs’ Ownership of a House With a Reverse Mortgage
A reverse mortgage allows people over the age of 62 to have a lien put on their home in exchange for payment of some sort. There are various reasons why someone may get a reverse mortgage, such as supplementing their income. The person who gets the reverse mortgage gets to stay in their home and does not have to make payments, but rather gets payments in return. If the homeowner leaves the house or when he or she passes away, the heirs have the option of paying back the lien amount or having the house go to the mortgage company. It is important, in considering those options, to call a New York estate attorney.
Generally, reverse mortgages are not a good idea financially. The fees are often very high, sometimes as much as tens of thousands of dollars. Also, the amount that someone gets could be low when compared to the equity in the home. Additionally, the homeowner would still be financially responsible for things such as tax bills and insurance, along with maintenance on the home. Because of this, it is usually considered wise to consult with a New York estate attorney, to figure out what will work best in your situation.
There are few ways to stop the reverse mortgage company from taking the home when the homeowner dies or has to leave the home. The main way this can be accomplished is for the reverse mortgage company to be paid back by having the heirs buy the property after the loved one who got the reverse mortgage passes away. This could be an especially important option in a case where value has been built on the property, such as could be the case if the decedent got the reverse mortgage when he or she was in their mid 60’s and died when they were 80. In such a case, the value of the home could have grown to the point that paying the bank back through purchasing the title from them is the best option.
What also needs to be considered is if it is actually worth it for the heirs to do this. If the home is in disrepair or has no equity, then ultimately the heirs may be spending money on something with no value. In such a case, the only option would probably be to walk away from the property. If that is the case, the title simply needs to be transferred to the reverse mortgage company by the executor and the New York estate attorney handling the estate. If you need help figuring out a reverse mortgage, call the Law Offices of Albert Goodwin at (212) 233-1233.