Larry you need more information. Reverse mortgages are paid out over time. example: owner borrows 50,000 to be paid to them (the owner) in monthly payments of $500. The loans don’t come do until after the total is paid. These are usually taken out by elderly folks that own their home free and clear, but need some monthly income. After they use all the cash they sell the home to pay the loan and move into apartments or nursing homes. It sounds like she may have topped out on the reverse mortgage and now can’t make the payments. That is not a good sign because she may not be able to pay you either.
Newbie seeks consul from the vets - Posted by Larry/atlanta
Posted by Larry/atlanta on December 01, 2000 at 20:25:39:
First I, would like to say hi to all and thanks for all the positive feedback i received from you guys/gals as well. This could possibly be my first deal. seller call wanting sell her house. asked if i would lease house back to her
the house has a loan balance(hud) of 65000. she mentioned the house has a reverse mortgage, would someone explain this one to me please. Homes in this area are selling in the 80k-110k price range. I know info here is very little, but any help is appreciated. meeting with seller tomorrow at noon. oops! almost forgot, she’s facing forclosure in 30 days. Thanks in advance to all who response.
Re: Newbie seeks consul from the vets - Posted by Kevin Subbert
Posted by Kevin Subbert on December 02, 2000 at 19:44:36:
She has to sell the house or buy it back from the bank. If the reverse mortgage is maxed out at 65000 then the bank has done their part and now wants their house or cash. The only way she would be able to stay is to refi or sell to you and you lease it back to her. If shes had a reverse mortgage up to now, she probably cant afford to pay you a profitable rent. What you may be able to do is get an option on the house and try to sell it retail. But the lady needs to understand that she is gonna have to leave. It sounds like a sad story because she has probably been there a long time and has alot of memories in that house.
However, there is alot of equity there! You need to get all of the details on this one. If she owes the bank 65k and the house is worth 110k, that 60% LTV if you buy it. I would not hesitate to pay cash for that kind of a deal. For 45k in equity I would go after this one anyway you can!