I received a call from a 62-year-old lady and her daughter who has been doing a reverse mortgage for about 3 months. It’s a refinance. She already has her counseling and her appraisal done. Her home appraised for $450,000 and the loan amount they are giving her is $280,000. They said that is the max they would give her. Her home is free and clear. She also owns another property that her daughter lives in. After 3 months of dealing with this company the loan officer (who is also a Realtor) called and said that they had to list the house that the daughter is living in for the reverse mortgage to close. The daughter has been paying for the mortgage. They are also asking for 3 years of proof of mortgage payments. Why would they ask for the house to be listed? Not sold, just listed. We were thinking that since the loan officer is also a Realtor, could he be trying to get a listing as well? He did tell them he does not do many of the Reverse Mortgages and is just trying to get back into them. Why ask for 3 years proof of mortgage payments? It’s on her credit report. They are not asking for proof of the daughter paying it. Some of these things do not seem normal especially after 3 months of processing the loan. I was hoping you could give me some insight? If they were to switch their loan to me, their counseling and appraisal would transfer correct? How long would the process take since both of those items are done?
As we discussed there are a couple questions. Is the debt joint with daughter to meet contingent liability requirements to offset debt with evidence payments were made by daughter? If it’s an FHA loan, it must be sold or refinanced. Given daughter is using payment for tax returns, possibly they have an agreement such as installment land contract? With the information available at this point, they would likely be best to sell the home and start over with a reverse mortgage at a later point. Reviewing her worksheet, it would also be worthy to see how the borrower is able to manage with only SSI. Is there additional income that could be used such as asset dissipation, public assistance, border income, etc.?