Comments on: With a reverse mortgage if owner stays in house and ends up with excessive equity does lender go after estate? http://www.reverse-mortgages-information.net/blog/reverse-mortgages/with-a-reverse-mortgage-if-owner-stays-in-house-and-ends-up-with-excessive-equity-does-lender-go-after-estate/190/ Reverse Mortgage pros and cons, FAQ, loan information, lenders Mon, 12 Jul 2010 08:39:39 +0000 hourly 1 http://wordpress.org/?v=3.3.1 By: J. Philip Real Estate http://www.reverse-mortgages-information.net/blog/reverse-mortgages/with-a-reverse-mortgage-if-owner-stays-in-house-and-ends-up-with-excessive-equity-does-lender-go-after-estate/190/comment-page-1/#comment-427 J. Philip Real Estate Wed, 01 Apr 2009 06:43:57 +0000 http://www.reverse-mortgages-information.net/blog/reverse-mortgages/with-a-reverse-mortgage-if-owner-stays-in-house-and-ends-up-with-excessive-equity-does-lender-go-after-estate/190/#comment-427 <a href=""></a> Reverse mortgages are tricky and prone to lots of misinformation. But do not worry in this case. First, the bank doesn't own the house so they don't get to sell it. The heirs have a year to refinance or sell. If the proceeds are not enough to satisfy the loan, the lender (or their insurance on the loan) absorbs the difference. This is a "non recourse rule" which entitles the lender to only the market value of the home and nothing more. The other assets are safe.

Reverse mortgages are tricky and prone to lots of misinformation. But do not worry in this case. First, the bank doesn’t own the house so they don’t get to sell it. The heirs have a year to refinance or sell.

If the proceeds are not enough to satisfy the loan, the lender (or their insurance on the loan) absorbs the difference. This is a “non recourse rule” which entitles the lender to only the market value of the home and nothing more.

The other assets are safe.

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