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Old 03-11-2018, 05:10 PM
 
13 posts, read 10,668 times
Reputation: 20

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Quote:
Originally Posted by anicon View Post

Person who took option 1 still has a home that they can afford on their fixed income and hopefully money in the bank.

Person two?? probably blew through all their money on rent. now they are 85 years old. living on social security. rent alone is more than they being in a month. they can no longer afford rent. have no savings and don't own a home.

So that is true, person 1 does have a home. Please allow me to vent for just a mo...

The bad news is that my parents were really bad money managers to begin with which didn't bode well. All the money they took out from the loan (~$80k/$120k purchase price) went to their head. In fairness they asked me and my brother if we wanted the house after, we said no (still no). In my dad's view, he left mom a house he thought she could manage by herself, age in place and when ready we'd just empty it and walk.

However when my father died two years later (now$60k in savings - after funeral costs and what not $45k) and my brother said that he would live with her to help but instead managed to run up debt which she paid including a DUI and a bunch of other not so fun stuff. Fast forward 4 years after he died and she finally asks me to step in (I was executor) and help her get out of the situation. Too little too late, and I probably should have stepped in earlier than I did but oh well I can't fix that now. She had already fallen twice with trips to the ER and left the gas oven or stove on. I live about 2k miles away and between them they had spent $45k!! We ejected my brother out (I paid for it) and looked high and low for a companion or someone that could be with her most of the time. No luck. Everyone that was trustworthy couldn't and a line out the door of strangers. Maybe they would have been ok, I'll never know. The town she was living in is small, western spiral arm of no where with not much to offer. Her church that she dutifully paid nearly $14k in tithes were no help and she was showing signs of dementia/memory loss. I couldn't live there with here and decided to move her into a independent living place. She was pissed and traumatized about leaving her home. Her new place is pretty nice with activities and exercises and people. Soon, she was going out and adjusting. Meanwhile, we allowed a family friend to take care of the place until I knew if she was going to stay or want to come back.

She makes the decision to stay where she is and I'm off to sell the house. Appraiser now values the house at $70k BUT with comps around it *might* fetch as much as $140k. The loan amount due on my statement show $105k owing on the loan so yay. Any money we might make off the sale goes to them right?? I can't afford to buy it otherwise I would just so I don't have to sign away all that money. My mother's savings are long gone and I have been covering her bills using my own savings for her emergencies. Meanwhile, my mom's condition is worse with Parkinson's and dementia. She's in respite right now and her social worker is hinting that she will need a Higher level of care. She has no money for assisted living but now that she is broke at least she would qualify for Medicaid. I've now moved myself to the house to figure out what to do with the damn thing. She can't move in there and now doesn't want to come back. All the pain she went through (and me by extension) had to be worth something right?

So - If you can make some sound recommendations... I'm listening.

1. If what you say is true that neither the bank nor HUD want the house, then can I negotiate with them for a reduction of the loan to the original amount and pay them some fee, closing cost or something?

2. If they do agree to that, how can I ensure that they won't come after me if I do the work it needs to sell it at a modest $110k?

3. If they don't how long do I have until they come and take the house?

Honestly, I need about 3 weeks to clear out the crap she has stored. Not just hers but grandmas, aunts, uncles etc.

Ok... I'm done... thanks for listening and if anyone had advice. I appreciate it!
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Old 03-13-2018, 07:38 PM
 
Location: Ocala, FL
407 posts, read 476,307 times
Reputation: 1299
Quote:
Originally Posted by SaharaBlue View Post
So that is true, person 1 does have a home. Please allow me to vent for just a mo...

The bad news is that my parents were really bad money managers to begin with which didn't bode well. All the money they took out from the loan (~$80k/$120k purchase price) went to their head. In fairness they asked me and my brother if we wanted the house after, we said no (still no). In my dad's view, he left mom a house he thought she could manage by herself, age in place and when ready we'd just empty it and walk.

However when my father died two years later (now$60k in savings - after funeral costs and what not $45k) and my brother said that he would live with her to help but instead managed to run up debt which she paid including a DUI and a bunch of other not so fun stuff. Fast forward 4 years after he died and she finally asks me to step in (I was executor) and help her get out of the situation. Too little too late, and I probably should have stepped in earlier than I did but oh well I can't fix that now. She had already fallen twice with trips to the ER and left the gas oven or stove on. I live about 2k miles away and between them they had spent $45k!! We ejected my brother out (I paid for it) and looked high and low for a companion or someone that could be with her most of the time. No luck. Everyone that was trustworthy couldn't and a line out the door of strangers. Maybe they would have been ok, I'll never know. The town she was living in is small, western spiral arm of no where with not much to offer. Her church that she dutifully paid nearly $14k in tithes were no help and she was showing signs of dementia/memory loss. I couldn't live there with here and decided to move her into a independent living place. She was pissed and traumatized about leaving her home. Her new place is pretty nice with activities and exercises and people. Soon, she was going out and adjusting. Meanwhile, we allowed a family friend to take care of the place until I knew if she was going to stay or want to come back.

She makes the decision to stay where she is and I'm off to sell the house. Appraiser now values the house at $70k BUT with comps around it *might* fetch as much as $140k. The loan amount due on my statement show $105k owing on the loan so yay. Any money we might make off the sale goes to them right?? I can't afford to buy it otherwise I would just so I don't have to sign away all that money. My mother's savings are long gone and I have been covering her bills using my own savings for her emergencies. Meanwhile, my mom's condition is worse with Parkinson's and dementia. She's in respite right now and her social worker is hinting that she will need a Higher level of care. She has no money for assisted living but now that she is broke at least she would qualify for Medicaid. I've now moved myself to the house to figure out what to do with the damn thing. She can't move in there and now doesn't want to come back. All the pain she went through (and me by extension) had to be worth something right?

So - If you can make some sound recommendations... I'm listening.

1. If what you say is true that neither the bank nor HUD want the house, then can I negotiate with them for a reduction of the loan to the original amount and pay them some fee, closing cost or something?

2. If they do agree to that, how can I ensure that they won't come after me if I do the work it needs to sell it at a modest $110k?

3. If they don't how long do I have until they come and take the house?

Honestly, I need about 3 weeks to clear out the crap she has stored. Not just hers but grandmas, aunts, uncles etc.

Ok... I'm done... thanks for listening and if anyone had advice. I appreciate it!

If Mom owes $105K and the house sells for $140K, the balance of $35K (less realtor fees, etc.) goes to your mom which you can apply to her care.

If the house doesn't sell and once Mom is out of the home for a year, the bank will foreclose and sell the house. Terms of the reverse mortgage are that the government (HUD) gets to eat any difference, i.e., they sell the house for $70K, HUD eats the $35K difference and nothing happens to you or Mom. Read the mortgage paperwork, it's all in there.

You'll have plenty of time to clear out the house.

Now, if Mom should pass before the house sells or is foreclosed, the heirs have the option of purchasing the home for 95% of the market value of the house if the mortgage is more than the market value. So if the house appraises for $70K, you could buy it for $66,500. Heirs have six months to decide what they're doing. If the mortgage is less than the market value, you have to pay off 100% of the mortgage amount.

Either way, they can't come after you personally as you didn't sign on the dotted line for the reverse mortgage (or any of their other bills such as credit cards, medical bills, etc.). You personally have no obligation to pay off anything your parents owed at their deaths. Their estate, however, is liable for credit card or medical bills and they get paid before anything is disbursed to the heirs. Again, the estate doesn't have to pay anything on the reverse mortgage.

Just be careful and make sure a bill is actually owed. A few days after my mom died, I got a bill in the mail from an ophthalmologist claiming she owed for glasses which I personally had paid for. Apparently they read the obituaries and decided to try to get paid again. Way too many crooks out there preying on the bereaved.
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Old 03-24-2018, 01:15 AM
 
77 posts, read 61,854 times
Reputation: 50
After I read all discussions, I still feel in normal cases, RM benefits seniors than hurts them. It's totall illogical to think the Government who oversees such program will allow such program that hurting majority of needy seniors to run. No program is fit for each and every situation, as far as I can tell.
If seniors want to take RM to supplement their SS and are able to manage reasonably well for the house, like paying tax, insurance and budget a proper house maintenance, and would not worry about estate inheritance, RM is a gift to them, because all interest and fee are none of their business to pay back. Why some people in this forum almost sounds like hate such concept is very interesting. For seniors who feel they can't follow the contract as I mentioned above, then they shouldn't get RM in first place. They would drive a wrong car to the destination.
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Old 03-25-2018, 10:44 AM
 
Location: Prescott AZ
6,138 posts, read 9,111,221 times
Reputation: 11591
I have said this before: There is a lot of misinformation out there about RM. Mine has worked wonderfully and I did my research before doing it. So many people who think they know all about it, but really don't.
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