Upon the death of the homeowner, the reverse mortgage loan immediately comes due, meaning that either the estate or its heirs must pay off the entire loan associated with the reverse mortgage within a short time to keep the property. In some cases, a reverse mortgage was taken out on the home unbeknownst to the heirs.
This can be a big repayment amount if you’re an heir or a family member who wasn’t aware of the reverse mortgage, or being tasked with paying it off. Oftentimes, family members do not have the flexibility or liquidity to pay off the entire balance of a reverse mortgage to the lender in a short time.
A reverse mortgage has strict time requirements for the payoff period after the passing of occupants. A loan from HCS Equity provides the estate with time to find permanent financing for the home.