Posted on: 25th Sep, 2009 04:30 am
If I take a reverse mortgage, will I still have an estate that I can leave to my heirs
If you can pay it off before your death, you can absoultely leave behind the property to your heirs or they will have to pay the reverse mortgage to keep the house
Hi stevecomish,
Welcome to our forum.
But you must have to pay off this mortgage before your death.
Thanks.
Welcome to our forum.
But you must have to pay off this mortgage before your death.
Thanks.
Thats is really not necessary, if your heirs are willing to pay that after your death
an heir is going to inherit the house when the last homeowner no longer resides in the property as their primary residence, so "yes", you'll still have an estate to leave your heirs.
however, your estate may or may not have equity when the heir inherits it, so they'll have to make a decision. if there's minimal or no equity left, the heir usually walks away from the house and lets the lender foreclose on it. if there's equity left, the heir can pay back the reverse mortgage lender and keep the house.
the most common way a heir does this is by selling the house. usually because they don't live by the house and don't want to rent it out. if they want to keep the house they'll refinance the reverse mortgage with a traditional foward mortgage. if they're old enough they have the option of refinancing the reverse mortgage with another reverse mortgage. more and more homeowners are getting life insurance policies when they get their reverse mortgage, and they make the heir the beneficiary. that way the heir receives the proceeds, tax free, within 30 days of the homeowner passing, and the proceeds from the life insurance is used to pay back the reverse mortgage lender, and the heir keeps the house.
however, your estate may or may not have equity when the heir inherits it, so they'll have to make a decision. if there's minimal or no equity left, the heir usually walks away from the house and lets the lender foreclose on it. if there's equity left, the heir can pay back the reverse mortgage lender and keep the house.
the most common way a heir does this is by selling the house. usually because they don't live by the house and don't want to rent it out. if they want to keep the house they'll refinance the reverse mortgage with a traditional foward mortgage. if they're old enough they have the option of refinancing the reverse mortgage with another reverse mortgage. more and more homeowners are getting life insurance policies when they get their reverse mortgage, and they make the heir the beneficiary. that way the heir receives the proceeds, tax free, within 30 days of the homeowner passing, and the proceeds from the life insurance is used to pay back the reverse mortgage lender, and the heir keeps the house.
