Archives for April 2017

Reverse Mortgages: What Are They and How Do They Work?

reverse mortgage

A reverse mortgage is a mortgage loan given to senior citizens that seek to utilize the equity in the home to support themselves in their old age. Generally speaking, the loan does not have to be repaid until the last surviving spouse either dies or permanently moves from the home. In the event of the death of the last of the husband and wife to die the estate of the second to die has approximately 6 months to repay the entire balance of the reverse mortgage or take action to sell the home for the purpose of paying off the reverse mortgage. After the reverse mortgage is paid off the rest of the equity derived from the sale of the home becomes an asset of the estate. Should the home be underwater, be worth less than the reverse mortgage, the estate and either the executor or administrator of the estate will have no personal liability with regard to paying off the portion of the reverse mortgage not covered by the sale of the home.

Who Is Entitled to Obtain a Reverse Mortgage?

Eligibility to obtain a reverse mortgage requires all of the homeowners be a minimum of 62 years of age. In addition, all mortgages on the home must be paid off prior to obtaining the reverse mortgage or at the time of obtaining the reverse mortgage. The home must be the primary residence of the individuals seeking to obtain the reverse mortgage. In addition, the homeowners must continue to pay homeowners’ insurance and property taxes of every type and nature that accrue on the home. The taxes can be property taxes, school taxes, town taxes and village taxes.

Loan Amounts

The amount the homeowners can obtain from the reverse mortgage depends on four (4) specific issues: the interest rate at the time of the reverse mortgage loan, the appraised value of the home, the age of the parties seeking to take the loan and the current government imposed lending limits at the time of the loan application.

How Reverse Mortgage Payments are Made

Attorney Elliot Schlissel

Reverse mortgage payments can be made on a monthly basis for as long as the homeowner lives in the home, for a fixed period of months or the homeowners can take a lump sum out all at once. In addition, the reverse mortgage can create a line of credit the homeowners can access at any time. It is not recommended that the homeowners take the lump sum of all the funds from the reverse mortgage. In these cases the homeowners may not be able down the road to pay at one time the taxes on the home. The non-payment of the property taxes on the home or failure to pay the homeowners insurance is a basis for the financial institution bringing a reverse mortgage foreclosure lawsuit.

Statute of Limitations Defenses in Foreclosure Losses: Six Year Statute of Limitations

write on paper

There is a six (6) year statute of limitations with regard to bringing a foreclosure lawsuit on a mortgage by a creditor. When the lender accelerates the mortgage (calls the entire balance due and owing, the statute of limitation period starts to run).

Acceleration of the Mortgage

When the bank accelerates a mortgage they must provide written notice to the homeowners. The bank is required to provide the homeowners with 90 days notice they they are accelerating the mortgage before they can initiate a foreclosure lawsuit. The failure of the bank to provide the homeowner with this 90 days notice gives the homeowner a legal defense to to foreclosure lawsuit. Our law office has had foreclosures dismissed due to the banks failure to provide the homeowner with this 90 day notice.

Restarting the Six Year Statute of Limitations

If the homeowner make a payment on a mortgage loan, enters into a mortgage modification or files a Chapter 13 bankruptcy that acknowledges the mortgage debt and agrees to repay it, each of these actions will restart the statute of limitations running all over again. The statute of limitations is a complete defense to a foreclosure lawsuit. If the 6 year period is approaching from the time the bank accelerated the mortgage the homeowner should be very careful to avoid taking any actions that will restart the statute of limitation period again. It is strongly suggested if you believe you have a statute of limitations defense, that you consult with an experienced foreclosure defense lawyer and get his or her opinion regarding this issue.

Attorney Elliot Schlissel

Elliot S. Schlissel and his associates for more than 3 decades have been representing homeowners throughout the Metropolitan New York area in foreclosure lawsuits. The law firm strives to keep homeowners in their homes and stop foreclosure cases from going forward.

Foreclosure Defense in Valley Stream, Lynbrook, Baldwin, Malverne, Freeport, Oceanside, Long Beach, Elmont, Lakeview, West Hempstead, Hempstead, Merrick and Bellmore, New York

We represent individuals throughout the New York Metropolitan area with divorce and child custody, personal injury, car accident, wrongful death, estate administration, nursing home and medicaid issues

The information you obtain at this website is not, nor is it intended to be, legal advice. You should consult an attorney for individual advice regarding your particular legal issue. This is attorney advertising.

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