Seniors were sold a risk-free retirement with reverse mortgages. Now they face foreclosure.
Seniors face foreclosure in retirement after failed reverse mortgage
Check out Tom’s view.........
and nothing in that article indicates the foreclosures were anything other than legitimate actions by the lenders to secure their liability thru the chattel mortgage
the owners of the property, the loan recipients, received up to 80% of the fair market value of their homes
they were NOT obligated to pay anything to the lender. they were obligated to maintain hazard insurance on the real property and to keep property taxes current - just like every other mortgagor - including those who have conventional, non-reverse, mortgages
the owners died, if the family does not pay ff the mortgage balance, then the house goes into foreclosure
what is wrong with that approach?
if the mortgagor fails to pay property taxes, the home is subject to foreclosure by the tax collector, which collector has a claim paramount to the mortgagee
so, what is so unreasonable for the mortgagee to expect the mortgagor to pay their taxes?
if the mortgagor fails to maintain property insurance on the home and it suffers a calamity of flood, fire, mudslide, etc., then the mortgagee has lost much of its collateral value
why is it unreasonable for the mortgagee to expect such hazard insurance coverage to be maintained?
from that article, the persons responsible for the foreclosure were those who failed to comply with the terms of the mortgage. just like anyone else who defaults on the loan covenants, that subject the property, the collateral of the underlying loan, to foreclosure action
so, why is it that they are presented as the victims and the mortgagees as villians in that article?