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What happens in a reverse mortgage upon death of borrower

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In case of death of the borrower, the homes goes under the ownership of his heirs. Now its their choice to sell the home or keep it with them. The lender officially gives a time of 3 to 12 months in order to decide about the home. Many people have misconception tat after the death of the borrower, the homes moves in the ownership of the banks. It is totally wrong, the home only belongs to the borrower in his life and to his heirs after his death.

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In case of death of the borrower, the house goes to the ownership of his heirs. Now, it is their choice to sell the house or keep it. The lender officially gives a time frame of 3 to 12 months in order to decide on what to do.

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Well, this is not something that you need to fret about. Even if the borrower dies, the beneficiary or the joint owners can live in the same house as long as possible. In fact, they do not have to pay anything while living in the house of the deceased reverse mortgage loan borrower. http://reversemortgageinterest.org/if-one-borrower-passes-away-what-happens-to-a-reverse-mortgage/

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The servicer must play the balancing role of showing empathy for the heirs on one hand and the requirements of the servicer on the other.

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When a borrower in a reverse mortgage dies, a letter is sent to the primary heir. Once the heir is notified they can either repay the loan in full and keep the property, sell the property and use the proceeds to repay the loan, deed the property back to the lender or abandon the property.

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