PROBATE Question - TROUBLE obtaining a loan payoff from Reverse Mortgage Lender

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PROBATE Question - TROUBLE obtaining a loan payoff from Reverse Mortgage Lender

Michael MorrongielloPro Member
Specialist · Napa, CA · Member since 2015 · 123 posts · 31 votes

Situation: Owner who took out a RV- Reverse Mortgage back in 2007 originally thru Wells Fargo passed away recently in 2023. 
That RV loan was transferred to HUD, then serviced by Champion Mortgage and most recently by Nationstar

The daughter of the Decedent (the Father who passed away) has been left with a MESS.
She called Nationstar and informed them that her Father has passed away. They told her that they would give her 6 months to sell the property or pay off the loan. However she and the family cannot find any will that exists, and NO SPECIFIC Information about the Reverse Mortgage loan at all. When they attempted to call BOTH Champion Mortgage and also Nationstar they were told that they could NOT speak with her nor provide her with any information about the loan because she has no evidence to show she is the executor of her Fathers estate (and they have the same last name)

Before we spend a LOT of time and money ($$) going down this rabbit hole with this property we really NEED to know WHAT may be still due on the Reverse Mortgage Loan.

Any TRICKS to getting more information from the loan servicer or a loan payoff generated by them?

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Tom GimerBusiness Member
DMV · Member since 2017 · 3k+ posts · 3k+ votes
2y

The lender will only provide information about the loan to a successor in interest. In this case the SII would the the executor or personal representative (depending on the jurisdiction) of the decedent’s estate. 

If the decedent died intestate (without a will) the family can still open an estate. They should do so in the county where the decedent resided at the time of his death. The court will appoint the executor/pr and issue letters of administration or whatever the evidence of the appointment is referred to locally. That evidence along with the death certificate should be sufficient for the lender to update the account with SII information and discuss the loan. 

If the payoff exceeds the value of the property, I believe federal law allows the family to purchase the property for 95% of its appraised value. Good luck. 



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  • Tom GimerBusiness Member
    DMV · Member since 2017 · 3k+ posts · 3k+ votes
    2y

    The lender will only provide information about the loan to a successor in interest. In this case the SII would the the executor or personal representative (depending on the jurisdiction) of the decedent’s estate. 

    If the decedent died intestate (without a will) the family can still open an estate. They should do so in the county where the decedent resided at the time of his death. The court will appoint the executor/pr and issue letters of administration or whatever the evidence of the appointment is referred to locally. That evidence along with the death certificate should be sufficient for the lender to update the account with SII information and discuss the loan. 

    If the payoff exceeds the value of the property, I believe federal law allows the family to purchase the property for 95% of its appraised value. Good luck. 



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  • Chris SeveneyBusiness Member
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    Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes
    2y

    @Michael Morrongiello

    Exactly what Tom said and just add that this is going to take a long time. If you are looking to buy this home if this got resolved before end of 2024 that would be a win as most people are not familiar with this process and going through probate

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  • Michael MorrongielloPro Member
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    Specialist · Napa, CA · Member since 2015 · 123 posts · 31 votes
    2y

    Tom / Chris 
    Thanks for affirming what we already knew.
    This father passed away leaving his family either intentionally or unintentionally with them only having a DEATH Certificate and a 2 year old Lender Statement from Champion Mortgage the REVERSE MORTGAGE Serviecer at the time (Not its Nationstar)
    Essentially he left his family with NOTHING and a BIG MESS....(no will, no Trust, no paperwork, no bank account info, etc.)

    Yes we are familiar with getting the daughter of the deceased (her Father) to be declared a successor in interest or executor of his estate. However as you stated that TAKES TIME and that COST MONEY - she does not have and we believe that there may be NO equity left in this property as the last statement from several years ago show he owed $330K on a property that today is worth maybe $400K

    We are reluctant to SPEND $$$ to only find out and affirm what we suspect; That there is NO EQUITY in this property and the Reverse Mortgage has "cannibalized" any equity that existed.

    Another TRICK someone told me is to get a credit report run on him since we do have the decedents SS# and IF the account is still active with DEBT owed it likely might show up on the credit report of the decedent. Not sure IF Reverse mortgage DEBT (outstanding balances) show up on ones credit report as a trade reference or not? THOUGHTS ?

    Its unbelievable that an immediate family member CANNOT simply obtain a written payoff request from the lender...Even a Title Company we engage with said they were rebuffed as well.

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  • Tom GimerBusiness Member
    DMV · Member since 2017 · 3k+ posts · 3k+ votes
    2y
    Quote from @Michael Morrongiello:

    Tom / Chris 
    Thanks for affirming what we already knew.
    This father passed away leaving his family either intentionally or unintentionally with them only having a DEATH Certificate and a 2 year old Lender Statement from Champion Mortgage the REVERSE MORTGAGE Serviecer at the time (Not its Nationstar)
    Essentially he left his family with NOTHING and a BIG MESS....(no will, no Trust, no paperwork, no bank account info, etc.)

    Yes we are familiar with getting the daughter of the deceased (her Father) to be declared a successor in interest or executor of his estate. However as you stated that TAKES TIME and that COST MONEY - she does not have and we believe that there may be NO equity left in this property as the last statement from several years ago show he owed $330K on a property that today is worth maybe $400K

    We are reluctant to SPEND $$$ to only find out and affirm what we suspect; That there is NO EQUITY in this property and the Reverse Mortgage has "cannibalized" any equity that existed.

    Another TRICK someone told me is to get a credit report run on him since we do have the decedents SS# and IF the account is still active with DEBT owed it likely might show up on the credit report of the decedent. Not sure IF Reverse mortgage DEBT (outstanding balances) show up on ones credit report as a trade reference or not? THOUGHTS ?

    Its unbelievable that an immediate family member CANNOT simply obtain a written payoff request from the lender...Even a Title Company we engage with said they were rebuffed as well.

    Perhaps you’ve tried this already — it’s not clear from the fact pattern. 

    Loan # is often found on page 1 (and elsewhere) of the recorded mortgage/deed of trust. If you have SSN of the decedent and loan # you should be able to call the lender and hopefully through an automated system request, as the borrower, the payoff to be FAXED to the # of your choice. 

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  • Chris SeveneyBusiness Member
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    Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes
    2y

    @Michael Morrongiello

    Blame the federal government as it’s the law

    For example I am on a mortgage only not my wife for one of our loans - they absolutely cannot talk to her at all about that loan

    If you are not on it you cannot discuss it

    This is why it’s important to have an estate plan

    Sorry to say this but it’s not the lenders fault but more on not having a will or any estate plan.

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