Buying a home with a Reverse Mortgage
So I have learned that when trying to create a list with owners who have less than 10% equity, I accidentally made a list of a bunch of reverse mortgage owners and mailed all of them. LUCKILY I only mailed one zip code. But the phone rang...
Situation...
85 year old lady with a BofA Reverse Mortgage and following details...
Amount - $735K in 2009
Home is worth $550K-600K MAX right now if completely dolled up
Loan term 70 months @ 2.74% ADJ
Lives with 1 dead beat son, the other son is in jail. Both supply no income. Believe it or not this is a good area.
She wants out but is too old to think about how to make that happen and what to do with her sons.
She is ok with living in an apartment
My thoughts so far...
From what I have researched, if she is the only borrower, when she dies the sons have to pay off the loan immediately or they are kicked out anyway because the bank will sell to get their money back. So either way they are going to have to move whether she sells to me or the bank sells it when she passes.
This is for me to live in, not an investment opportunity. So there doesn't need to be a whole lot of meat on the bone. My primary goal is to get into a place with as little out of pocket money as possible. Making the payments isn't a problem. This scenario may not work because my guess is a significant dollar amount will be required to be payed immediately when she sells. I don't know that figure, nor would she tell me how much she is getting monthly.
Has anyone bought a home that has a reverse mortgage on it?