Typically when a senior takes out a reverse mortgage loan on a home, they intend to age there. But on occasion and for various reasons, the homeowners wants to or needs to sell the home before the loan comes due and payable. So, what now?
Although this is an important factor, it’s not nearly as daunting as it sounds. Here’s where to start:
Step 1.) Locate your reverse mortgage loan documents and find any pertinent information regarding the sale of the home. It will vary from lender to lender. Most (but not all) reverse mortgage loans are FHA insured. This means even if you owe more on the loan than the home is worth, you will never owe more than the home sells for. Consult with a real estate or elder law attorney if you have questions or concerns.
Step 2.) Contact the reverse mortgage lender to get a payoff quote. This combined with a home appraisal will give you a good idea of what the sale will look like and what amount of funds you could potentially walk away with.
Step 3.) Find a real estate agent. When seeking out an agent, be sure to provide your reverse mortgage loan information up front and look for someone who has experience with such a sale.
Step 4.) Prepare the home for sale. From here, everything is similar to any home sale. You want to prep the home, keep it clean for showings, update anything you may need, etc.
Step 5.) Sell the home, pay off the reverse mortgage loan (consult with a real estate or elder law attorney if you have questions when paying off the loan), then reap the rewards. Congrats!
HECM reverse mortgages are available to seniors 62 and over all over Connecticut. To learn more, contact a reputable reverse mortgage lender.
Sara Cornwall is a local Reverse Mortgage Advisor serving the entire state of Connecticut. Contact Sara and learn if reverse mortgage is right for you.