Reverse Mortgages: When a Spouse is Too Young to Qualify

There are never any required payments for a reverse mortgage until the borrower dies, moves, or fails to pay property taxes or insurance. If one of those events happens, the full amount of the loan is due.

Sometimes one spouse would not be 62 years old yet and be too young to qualify for a reverse mortgage. HUD would then require the younger spouse to be removed from title because they did not qualify for the loan.

This created a big problem when the older spouse passed away and the loan came due. The surviving spouse would have to pay off the reverse mortgage. This resulted in many surviving spouses being forced to sell their house or risk a foreclosure.

HUD fixed the problem of surviving spouses being evicted by allowing them to stay in the house after the borrower passed away. The revised rules still do not require any monthly house payment from the surviving spouse.

HUD also allows a spouse younger than 62 years old to remain on title for the loan. This only

applies if the people were married at the time the loan was closed. The surviving spouse cannot access any additional money in a line of credit from the reverse mortgage, but no payments are due. This allows the surviving parent to live in their home if they want to, and keeps them from having to move in with other family members.

The reverse mortgage has had many changes the past 20 years to fix past problems. We are happy to answer any questions without any obligation.

John C. Bennett is a real estate closing attorney and owner of Origin Title and Escrow, Inc.. Since 2003, Origin Title has handled real estate transactions – purchases, refinances, reverse mortgages – quickly and professionally. There will be no surprises, nothing misunderstood. Title searches are thorough and well-reasoned, to avoid unpleasant surprises later down the road. Calculate your closing costs in Georgia or Florida using our calculator or contact Origin Title using this form.