My dad had did reverse mortgage. He is now deceased and left me a Land Trust. My question to you I am a first time home buyer and they want 90 thousand for this house. I just recently renovated the house and put 30,000 before my dad passed away. Not knowing that he did a reverse mortgage. I now in the process of trying to build my credit and income. Do I sell it or do I purchase it or walk away and take a lost.
Terry Says: Oh this is a terrible situation. I am all in favor of Reverse Mortgages, which allow seniors to stay in their own home. But at death, the amount of the loan plus interest must be repaid. It is unfortunate that he did not explain this to you. He surely had counseling before he took out the RM and they explained that to him!
So basically you poured your savings into a house that is now owned by the bank. And to get it back, you need to take out your own mortgage to buy the house. Is the house worth $90,000? Will you qualify for a mortgage? Do you have any money for some sort of down payment?
I suggest that if you want to keep the house (and it may be overpriced because the bank wants to get its money back) that you ask the RM lender to work with you and help you get a mortgage you can afford — and at a reasonable rate. There are also some “first-time home buyers” programs in Illinois that might be able to help. Here’s a link to the page that describes some of those programs: http://www.ihda.org/homeowner/granthomebuyer.htm
You’ll have to think carefully about whether you are ready to take on a mortgage — AND if this home is worth it for current, not sentimental, reasons.