Many times there is a significant difference in what an older spouse and a younger spouse will qualify for on a reverse mortgage; the older a person is, the more money they qualify for on a Reverse Mortgage. What do you do if the older spouse has enough to cover paying off the mortgage but the younger spouse does not? What do you do if you needed a Reverse Mortgage and the younger spouse was under 62 years old? These were some tough questions that many senior homeowners have had to face in the past. Some decided to remove the younger borrower off of title in order to get a HECM Reverse Mortgage; in some situations, they were going to lose the home anyway, so this was done as a last resort.
Removing the younger spouse from title means they lose the protection and guarantee a Reverse Mortgage would have given them, namely, to live in the home the rest of their lives, along with their spouse. There have been recent changes that allow a borrower younger than 62 to receive protections from a Reverse Mortgage as long as they are married to a person 62 and older, but the FHA had done nothing to address the homeowners that were married and came off title to get this FHA insured product.
On January 29th 2015 the FHA announced that it will now allow lenders of FHA HECM products the option of delaying foreclosure of non-borrowing spouses (NBS). Let me clarify, this is an option, not a requirement for lenders. For those with case #’s assigned before August 4th 2014, “FHA’s new guidance will allow reverse mortgage lenders to assign ‘eligible’ HECMs to HUD upon the death of the last surviving borrowing spouse, thereby allowing eligible surviving spouses the opportunity to remain in the home despite their non-borrowing status,” FHA stated in an announcement Thursday on the release of Mortgagee Letter 2015-03. This assigning of the Non-Borrowing Spouse to HUD, is called Mortgage option Election, or MOE.
Here are some conditions to be ‘eligible; for NBS protections:
1. NBS had to be legally married at time HECM loan was closed
2. Currently lives at HECM property as primary residence
3. Can obtain marketable title, or legal right to property in 90 days of last HECM borrower passing away.
The Lender has 30 days to determine if one is ‘eligible’ for MOE after becoming aware of the death of the last person on the Reverse Mortgage. In order for the lender to choose to elect MOE they have a few qualifications they have to look into:
1. determine if the surviving spouse is “eligible”
2. determine if the current unpaid principal balance ( or total owed) is less than or equal to the max claim (or original appraisal amount or HECM Limit, whichever was lower) at the close of the HECM loan.
3. if the surviving spouse was old enough but elected not to be on the RM, the current loan balance cannot be higher than what the original principal limit would have been for surviving spouse at close of HECM loan.
If the surviving spouse meets all of these conditions, it gives the lender a choice to modify their Mortgage Insurance contract and assign an eligible NBS’s HECM to HUD in lieu of foreclosure. Again, this is not something the lender is required to do, but any non-borrowing spouses that fit the criteria can petition the lender to make this change which would allow them to live in the home the rest of their life without any mortgage payment. This is one more change to the HECM reverse mortgage that can do so much good. This change may truly save the homes of many widows for the rest of their lives! If you know of anyone in this situation, please pass this article along so that we can get the word out to anyone that this information may help.
Tags: aarp reverse mortgagealternative solutions to reverse mortgagesare reverse mortgages safebank mortgage reversebreaking news on reverse mortgageCaliforniacalifornia reversecalifornia reverse mortgagecalifornia reverse mortgage lenderCalifornia Reverse Mortgagescan i get a reverse mortgage if i am on social securitycan i get a reverse mortgage if i am short moneycan i get another reverse mortgagecan i get more money on a reverse mortgagecan i redo my reverse mortgage?can I talk to a reverse mortgage consultant face to faceCitrusdo I have to pay homeowners insurance with a reverse mortgageeliminate mortgageeliminate mortgage paymentEliminate Mortgage PaymentsEliminate MortgagesFHA reverse mortgageFHA Reverse Mortgagesfinancial adviser reverse mortgagefinancial advisor reverse mortgageget rid of mortgageget rid of mortgage paymentshelp seniors with mortgagehelp seniors with mortgage loanHelp Seniors With Mortgage Loanshelp seniors with mortgage paymentHelp Seniors With Mortgage Paymentshipoteca inversa descuentohipoteca inversa mas baratahipoteca inversa mas dinerohipoteca inversa menos de 62homeHow A Reverse Mortgage Workshow many times can i do a revers mortgageHow reverse mortgage worksHow reverse mortgages workHow To Get Rid Of Your MortgageHUD reverse mortgageInfo On Reverse MortgagesInformation On Reverse MortgagesJumbo reverse mortgagelive inlive in homeLive In Homesloan helplos angeles reverse mortgagelos angeles reverse mortgage lenderlowest price on reverse mortgagemortgage + robert wagnermortgage applicationmortgage helpMortgage Help For Seniorsmortgage lendermortgage program reversemortgages for seniorsmost competitive reverse mortgage companyno more mortgageno more mortgage paymentNo More Mortgage Paymentsno mortgage paymentsnon-borrowing spouse reverse mortgagereputable reverse mortgage companyreversereverse annuity mortgagereverse equity mortgageReverse Equity Mortgagesreverse loanReverse LoansReverse Mortgage - Los Angeles reverse mortgage san diegoreverse mortgage 4th leg of retirement income stoolReverse Mortgage AAG scamreverse mortgage advantagesreverse mortgage annuityreverse mortgage applicationReverse Mortgage ApplicationsReverse Mortgage Arrowhead Credit Unionreverse mortgage baby boomerreverse mortgage bad creditReverse Mortgage bankreverse mortgage bank of americareverse mortgage bankruptcy okReverse Mortgage BanksReverse Mortgage bargainreverse mortgage best servicereverse mortgage breaking newsreverse mortgage brokerReverse Mortgage Brokersreverse mortgage calculatorreverse mortgage calculator anonymousreverse mortgage calculator no personal informationreverse mortgage can I get an annuityreverse mortgage can I redoReverse Mortgage chart of feesReverse Mortgage ChaseReverse Mortgage cheapestReverse Mortgage Companiesreverse mortgage companyreverse mortgage consultantsReverse Mortgage customized servicereverse mortgage debtreverse mortgage disadvantagesreverse mortgage discountedreverse mortgage discountsReverse Mortgage discounts for seniorsReverse Mortgage DVDreverse mortgage effect on heirsreverse mortgage estate planreverse mortgage expertReverse Mortgage ExpertsReverse Mortgage face to faceReverse Mortgage factsReverse Mortgage feesreverse mortgage for buying 2nd homereverse mortgage for fixing up my homereverse mortgage for home remodelreverse mortgage for investingreverse mortgage for investment propertyReverse Mortgage for Law Enforcementreverse mortgage for manufactured home purchasereverse mortgage for manufactured homesReverse Mortgage for PoliceReverse Mortgage for Public Servantsreverse mortgage for seniorReverse Mortgage For SeniorsReverse Mortgage for Teachersreverse mortgage for those under 62reverse mortgage for those under 62 years oldReverse Mortgage Free DVDreverse mortgage guaranteereverse mortgage habla espanolreverse mortgage happyReverse Mortgage HECMReverse Mortgage highest cash outReverse Mortgage highest payoutreverse mortgage highest payoutsreverse mortgage hipoteca inversareverse mortgage how long do I have to wait after bankruptcyreverse mortgage how long do I have to wait after short sale reverse mortgageReverse Mortgage husband is under 62reverse mortgage in 29 palmsreverse mortgage in adelantoreverse mortgage in AlhambraReverse Mortgage in Alpinereverse mortgage in Altadenareverse mortgage in apple valleyReverse Mortgage in ArcadiaReverse Mortgage in banningReverse Mortgage in BarstowReverse Mortgage in BeaumontReverse Mortgage in Bellflowerreverse mortgage in big bearReverse Mortgage in BonitaReverse Mortgage in Bonsallreverse mortgage in BurbankReverse Mortgage in CalabasasReverse Mortgage in CalimesaReverse Mortgage in Canyon Countryreverse mortgage in canyon lakereverse mortgage in carlsbadReverse Mortgage in Castaicreverse mortgage in cathedral cityReverse Mortgage in Cherry Valleyreverse mortgage in chino hillsreverse mortgage in Chula vistaReverse Mortgage in City HeightsReverse Mortgage in ClairemontReverse Mortgage in Coachellareverse mortgage in comptonreverse mortgage in coronareverse mortgage in covinaReverse Mortgage in CraftonReverse Mortgage in Crestlinereverse mortgage in culver cityReverse Mortgage in Descansoreverse mortgage in desert hot springsReverse Mortgage in Diamond Barreverse mortgage in DowneyReverse Mortgage in Eagle Rockreverse mortgage in Eastvalereverse mortgage in el CajonReverse Mortgage in El CerritoReverse Mortgage in Encantoreverse mortgage in Encinitasreverse mortgage in Escondidoreverse mortgage in Fallbrookreverse mortgage in fontanareverse mortgage in fountain valleyReverse Mortgage in FullertonReverse Mortgage in Gardenareverse mortgage in glendaleReverse Mortgage in Grand TerraceReverse Mortgage in Grantvillereverse mortgage in hemetreverse mortgage in hesperiareverse mortgage in high desertReverse Mortgage in Highlandreverse mortgage in HollywoodReverse Mortgage in Homelandreverse mortgage in huntington beachReverse Mortgage in Idyllwildreverse mortgage in imperial beachReverse Mortgage in Indioreverse mortgage in Inglewoodreverse mortgage in IrvineReverse Mortgage in Joshua TreeReverse Mortgage in Jurupareverse mortgage in la canada flintridgeReverse Mortgage in La Crescentareverse mortgage in la HabraReverse Mortgage in La JollaReverse Mortgage in La MesaReverse Mortgage in La PresaReverse Mortgage in La PuenteReverse Mortgage in La QuintaReverse Mortgage in Laguna BeachReverse Mortgage in Lake Arrowheadreverse mortgage in lake elsinoreReverse Mortgage in Lake Los AngelesReverse Mortgage in Lakesidereverse mortgage in Lakewoodreverse mortgage in LancasterReverse Mortgage in Lenwoodreverse mortgage in long beachreverse mortgage in los angelesReverse Mortgage in Lucerne ValleyReverse Mortgage in Lynwoodreverse mortgage in malibureverse mortgage in menifeereverse mortgage in Mira mesaReverse Mortgage in Miramarreverse mortgage in mission valleyreverse mortgage in mission ViejoReverse Mortgage in Moreno Valleyreverse mortgage in murrietaReverse Mortgage in National Cityreverse mortgage in newportreverse mortgage in norcoReverse Mortgage in NorthridgeReverse Mortgage in Nuevoreverse mortgage in oceansidereverse mortgage in ontarioreverse mortgage in orangeReverse Mortgage in Orangecrestreverse mortgage in palm springsreverse mortgage in Palmdalereverse mortgage in pasadenaReverse Mortgage in Pear BlossomReverse Mortgage in PendletonReverse Mortgage in Pinon HillsReverse Mortgage in Porter Ranchreverse mortgage in PowayReverse Mortgage in Quartz Hillreverse mortgage in RamonaReverse Mortgage in Rancho Bernardoreverse mortgage in rancho CucamongaReverse Mortgage in Rancho PenasquitosReverse Mortgage in Rancho Santa FeReverse Mortgage in Redlandsreverse mortgage in redondo beachreverse mortgage in riversideReverse Mortgage in Rowland Heightsreverse mortgage in running springsreverse mortgage in san bernardinoreverse mortgage in san diegoreverse mortgage in san DimasReverse Mortgage in San Gabrielreverse mortgage in san jacintoReverse Mortgage in San MarcosReverse Mortgage in San MarinoReverse Mortgage in San PedroReverse Mortgage in San Ysidroreverse mortgage in Santa Clarareverse mortgage in santa monicareverse mortgage in Santa Paulareverse mortgage in SanteeReverse Mortgage in Scripps RanchReverse Mortgage in Seal BeachReverse Mortgage in Sierra MadreReverse Mortgage in Signal Hillreverse mortgage in Simi valleyReverse Mortgage in Southern CaliforniaReverse Mortgage in Spring Valleyreverse mortgage in sun cityReverse Mortgage in Sunny Slopereverse mortgage in temeculareverse mortgage in the san gabriel valleyReverse Mortgage in Tierra SantaReverse Mortgage in Topangareverse mortgage in TorranceReverse Mortgage in Torrey PinesReverse Mortgage in TujungaReverse Mortgage in TustinReverse Mortgage in Universal CityReverse Mortgage in Valindausing a reverse mortgage for retirement planningReverse Mortgage in Valle Lindoreverse mortgage in van Nuysreverse mortgage in victorvillereverse mortgage in vistareverse mortgage in west covinaReverse Mortgage in Westmontreverse mortgage in whittierreverse mortgage in wildomarReverse Mortgage in WinchesterReverse Mortgage in WoodcrestReverse Mortgage in Woodland Hillsreverse mortgage in yorba lindaReverse Mortgage in YucaipaReverse Mortgage in Yucca Valleyreverse mortgage inforeverse mortgage informationreverse mortgage insuranceReverse Mortgage lenderReverse Mortgage Lendersreverse mortgage line of creditreverse mortgage loanreverse mortgage localReverse Mortgage low feesReverse Mortgage lower IMIPReverse Mortgage lower Mortgage Insurancereverse mortgage lowest feesReverse Mortgage lowest pricereverse mortgage lump sumreverse mortgage monthly checkReverse Mortgage No Bankruptcy seasoningReverse Mortgage no short sale seasoningReverse Mortgage over 1 million valuereverse mortgage paymentsreverse mortgage payoutsreverse mortgage privacyReverse Mortgage Programsreverse mortgage pros and consreverse mortgage protectionsreverse mortgage recommended by AARPreverse mortgage recommended by my doctorreverse mortgage refinancereverse mortgage refinance calculatorreverse mortgage refinance can I get more moneyreverse mortgage refinance highest payoutreverse mortgage refinance what are the rulesreverse mortgage refinancingreverse mortgage retireereverse mortgage retirement incomereverse mortgage riversidereverse mortgage run numbersreverse mortgage san diegoreverse mortgage savingsReverse Mortgage se habla espanolreverse mortgage short sale okreverse mortgage shortagereverse mortgage social securityreverse mortgage testimonialsreverse mortgage to investReverse Mortgage toolreverse mortgage trustreverse mortgage wells fargoReverse Mortgage wife is under 62reverse mortgage will there be equity leftreverse mortgage world war 2 generationReverse Mortgage young spouseReverse Mortgages - Southernreverse mortgages southern Californiariverside reverse mortgageRobert Wagner Mortgagessafest reverse mortgage companysenior loansenior loansstop forclosureStop Foreclosurewhat are reverse mortgage payments