Many senior reverse mortgage borrowers and surviving spouses are facing foreclosure on reverse mortgage loans that were intended to provide greater stability to be able to age in place. Some reverse mortgage borrowers are at risk of foreclosure due to alleged default on property taxes and insurance, and they have difficulty accessing loss mitigation options. Non-borrowing spouses, who have been under threat of foreclosure after the death of the borrower spouse, can now benefit from a recently revised Housing and Urban Development (HUD) policy, but imminent deadlines will require prompt action. Consumer attorneys can play a vital role in helping older homeowners navigate these options to prevent foreclosure.
What You Will Learn
- How FHA-insured reverse mortgages work and the circumstances that can lead to foreclosure
- What loss mitigation options are available for borrowers who have defaulted on property taxes and/or homeowners insurance
- How to take advantage of HUD’s new & improved policy (Mortgagee Letter 2019-15) for non-borrowing spouses to remain in the home after the borrower’s death
Rachel Scott is a staff attorney in the Senior Citizens Law Project of the Atlanta Legal Aid Society, where she focuses on mortgage and homeownership issues affecting seniors. Rachel also works with the National Consumer Law Center to provide support to advocates representing consumers at risk of foreclosure on reverse mortgages.