My mother’s reverse mortgage was assigned/sold to HUD before I even had a chance to notify her mortgage company of her passing…less than 2 weeks after she died. I already have title to the home and would like to sell it and keep the proceeds. HUD’s servicer, Compu-Link is impossible to contact and I’m afraid they will cause delays once the house has an offer and we are ready to sell.
AND….
If you find correspondence from FHA, that as well. FHA is involved in how RMs are done (FHA gets initial MIP / mortgage insurance premium) for HECM RMs.
Two weeks from day of death is pretty fast for entire case file to move over. My guess is moms RM was already noncompliant red flagged. All sorts of stuff can be noncompliant: taxes unpaid, property insurances unpaid, egregious maintenance issues (new roof needed), any change in ownership (transferring title), owner moved out more than 6 months. RM agreement has info as to compliance.
RM can also go to HUD if it’s become a super crappy property. So $ lent by the RM to the owner is approaching or beyond most optimistic appraisal of the property. RM cuts its losses, gets made whole from HUD and turns crappy house and terms of the RM over to HUD to deal with. Even if the elderly owner still alive & in the home, HUD takes over servicing.
If noncompliance came up for RM lenders radar, they would have sent mom letters AND ALSO they did a noncompliance work up (required by FHA & HUD) to the Feds. Then determination done that because of the type(s) of issues, it’s Federal level of noncompliance best dealt with by HUD. & lend turned over to HUD. There would be letters sent out on all this specifically sent to mom.
If compliance abt ownership / Title transfers, it’s rather serious. Imho you need to ASAP find an attorney. Maybe a Real Estate atty who does litigation or maybe a Criminal defense attorney. Not a regular Criminal Defense guy; it’s more you want a mortgage fraud defense atty. It’s a white shoe law firm specialty practice work as Federal laws involved.
Fwiw RM lenders really don’t want to ever turn a loan over to HUD. They want to hold onto the loan then foreclose quickly after elder dies or goes into a Nursing Home or owner does have $ to pay taxes or a required repair, so owner defaults. RM wants the property and wants to sell it asap. RM companies have a system to do legal foreclosure with house usually sold to an investor. All quickly done.
RM isn’t abt to let family / heirs change Title or set timeframe to clear out house and placed For Sale. My understanding is that it is ONLY if family is able to pay 90-95% of homes appraised value $$$ to pay RM off can family acquire property before or after the owner dies. If mom didn’t settle the lend before signing off to change title, this is going into mortgage fraud territory. It’s serious, ya need an attorney.
Again pls go thru to find correspondence, take all that paperwork you did to change title and find an attorney to evaluate your situation.
Your mom had a HECM non-recourse type of Reverse Mortgage backed by HUD. What that means is if there are issues, the RM company can jettison the lend and its debt to HUD. So HUD becomes the entity who is owed.
For a RM company to actually turn over their lend to HUD, usually is because it’s very very negative equity situation. Or there is some type of non compliance & legal issues with the property. Or a combo of all this. So if that happens, the RM lender stops its involvement in servicing that RM, turns the RM over to HUD, gets paid by HUD whatever losses it may have incurred for doing this RM. So HUD completely takes over. If, for this situation, elder has died - if I’m not mistaken- HUD starts a foreclosure unless heirs can settle the RM debt owed at 90% - 95% within a pretty narrow time frame. If heirs can’t come up with the cash to pay it off pretty asap, then HUDs foreclosure runs its course.
A couple of ?s for you…… how did you go about having title changed to be in your name? Done by attorney? Witnessed? notarized?
-What type of document did mom do to transfer her home to you? By that I mean, what type of Deed was done?
- When did mom do this…. days / months b4 her death?
-Did she or you file/record this document at county courthouse?
- Did you actually pay your mom $ for her house? If so, how was the $ amount determined that you paid mom? and what is the status on that $ now?
OR
- Did she transfer her home to you without any $ paid?
- Were you her DPOA at the time this was done? If not, who was?
and…
- Was mom on a Medicaid program that paid for her stay in a NH, AL or MC? or paid for her to have InHomeHealthcare? or covered her to be enrolled in a PACE type of day program?
You need a lawyer, but the answers on the above will shed some light as to what kind of issues mom’s transfer of title will pose & what type of legal needed.