Mom received final notice of occupancy from reverse mortgage company. What happens if she doesn’t reply?

Kat, please reread JoAnns posts. If you do not personally pay the delinquent property and school tax bills on your moms house, those payments will be taken off the top when the house finally sells. Has to happen to ever get a clear title, I’m guessing mom did not pay these - & all those delinquent utilities bills - because she didn’t have the $ combined with not being cognitive to understand the need to do so.

Taxes $ 4,000. And another property tax bill coming due. More $$$. Placing your mom into a facility, may mean she will need to put up a hefty deposit to get a bed in a SNF/NH. Mom/you many need additional elder law attorney work done. All this has co$t$.Unless mom has a significant amount of money or you personally do and will be private paying for her stay in the NH (7K-15K a mo kinda average), it may be better to hold off on paying those taxes. It’s already delinquent… might be easier just to it get paid from Act of Sale.

Please please please realize that RM absolutely DNGAF in allowing an elder or their family or heirs to drag out for months and months a pay back of the RM. HUD backed HECM have to allow family an opportunity to buy the property but the window is narrow. Find out exactly what the timeframe is they have for you / mom have to be able to buy the house and close the deal. If it’s 85 days from now, that’s mid April. If you find it’s $321,000 RM payoff and you do not have 321K liquid in the bank and absolutely do not have the ability to get a personal loan for 321K as you do not have the collateral or creditworthiness to do this, step back and let it go. I know this sounds all ruthless and harsh, but I’d hate to see you go another couple of months, pay 4K taxes, another 10K on repairs, find even more repairs needed so more $$$, there’s an issue with Medicaid so NH wants 2 months private pay to keep mom so that’s 15k, there’s something else and you end up not having all the $ needed to pay off all the RM….. it goes to foreclosure. Really have a heart to heart frank discussion with your husband on all this & perhaps someone else you trust to get a more clear eyed perspective on the situation.

RM have a whole system to how they manage the end of the mortgage via a foreclosure process. They have subcontractors that post the Notices, do drive by photos on the condition of the home, run a courthouse search, etc. Like that process servicer who came to your moms house to leave the Notice works for a number of mortgage companies or debt collection companies or law firms and his bill will be in your moms foreclosure bill. They will be nice to you & mom, but the terms of the mortgage contract are in their favor.

Good luck on this. & try to not let this get you too too overwhelmed.

I am so glad Mom got help and everyone agrees that she can't live alone. Yes, I hope didn't pay back taxes. I allowed Moms to go once she was on Medicaid. I live in NJ and she pd 6k a year. The house did sell and the tax leins satisfied then.

Kat, do you actually know - like have a $ amount figure - of what your moms RM buyout would be at? And what it’s based on?

you mentioned in the past you thought house worth more than RM.
There are lots of fees atop the interest. I’d be concerned that as your mom wasn’t perhaps cognitive all sorts of fees added onto her old mortgage. And then fees for its placement with a new RM service holder. That process server who placed the Notice on her front door had fees and expenses that were attached to her RM. You want to make sure the figure you get is the latest $ amount owed by your mom.

You have a lot to deal with right now In her being hospitalized and eventually placed into a NH and dealing with her home. But realize the RM have a very narrow window for the elder to buy their home back from the RM. She went into default on the RM, they can foreclose. Your mom is still alive and it’s a slightly different situation than a heir wanting to buy their deceased parents home who had a RM. Whatever the case, it’s going to need to be bought pretty much as if it is a cash sale. It will need to be appraised as it can be bought at 95% of appraised value - even if less than the RM - as HUD / HECM RM will cover the difference. But if you want to buy the house, you need imo to have the $ to be able to buy it as a cash sale & asap, probably within 30-90 days. You need to have $$$ to buy it at 95% of appraised value.

if mom / you want to put it up for sale, like with a Realtor, clearly get the information from the RM as to the timeframe allowed to do this. It could be pretty narrow. Like 90 days or even less to have it on the market and it needs to be listed with a Realtor that does these type of deals. So no FSBO nonsense. Remember the RM can totally foreclose, it holds the upper hand.

Your moms house sounds real challenging. Like I’m picturing a hoarder house with lots of serious maintenance issues… front door cannot open. It had rotten food and utilities shut off. It’s not move in ready and not getting that type of buyer & that $$$$. If it was cited and tax delinquent; it’s a hinky address to get permits pulled. Sometimes it’s best to just walk away, just sayin’.

Kats, thanks for the update. Glad that mom will get the care she needs.

Hope your mom gets the care she needs now and can be placed in a high quality nursing home.

It would be time (sorry more work) to -- after legal advice about what steps and documentation to take -- find a realtor to sell the house if it is worth more than the RM. Those funds, the fees from the relator's commissions, any legal fees; should be paid from your mom's funds including the funds from the sale and at closing the policy value of the RM can be paid off as part of the settlement. Any funds remaining thereafter would go to paying her monthly nursing home costs; ditto for any other assets she may have (?).

Once her assets are spent down to below the limit required for your state (most states are around $2K total); then she can apply for Medicaid coverage of her long term care costs. But best to get with a licensed elder care attorney in your state to map out all of these steps. The nursing home where she is placed can also be helpful, and may have recommendations on elder care lawyers they are aware of and with whom they may have previously work on similar Medicaid spend down and application processes for residents.

Getting access to all your mom's accounts (bank, Social Security, Medicare, IRA or retirement, any insurance policies, utilities, etc.) and setting them up as on-line will make it easier for you to handle the paper work (including filing her taxes) moving forward.

As others have said; document, document, document everything you do including notes from any conversations and keep receipts for any and all expenses paid for her. Yes many expenses can be paid from her funds as part of the Medicaid spend down including the legal fees and pre paid death/funeral expenses, the elder care lawyer can help you with that; what to pay from her assets and before applying to Medicaid.

You have done so much great work and this is not a fun journey to be on. Few have much knowledge about this journey until the trip has already started and may be mid course. Best of luck!

Kat, so she was taken from her home via EMS to the ER /ED and likely to permanently be moving into a NH once she leaves the hospital? I’m glad for her & for you. This is drastic but really it was all going to be just putting bandaids on a way more serious problem if she stayed in her home.

If that is the situation, spending anymore time or energy or $ on the home is no longer her responsibility or yours as her POA as she has defaulted on the terms of the Reverse Mortgage by not maintaining the property and by not paying the property taxes. And once she moves into a NH full time she is in default on the other requirement to live in the home as well. The RMs have subcontractors who deal with properties in all phases of disrepair and damage. It’s not her responsibility once she defaults on mortgage terms,

RM that are HECM / HUD are federally guaranteed. So if the RM somehow looses $ on the deal they did on your moms house as she didn’t do maintenance, didn’t pay taxes, did hoarding so lots of reno needed, etc, then HUD fully makes up the difference with her RM. Read that again, HUD covers the spread so to speak! Paying her delinquent property taxes makes zero sense to do. If the place is blight noticed by the City, HUD will pay for the RM to have the place to be bulldozed, it’s an ICC program that HUD, NFIP, couple of other federal programs can tap $ from to do Increased Costs for Compliance aka ICC when something goes especially nasty eg flood. (ICC $ from Katrina, it paid anywhere from $8k for venting, 20k to be “slabbed”, to $135K to elevate homes). So you paying for stuff is imo a waste of your money. Personally you may want to try to salvage mementos, photos, clothing, reusable items she may need. But if most things are moldy, just leave them.

please keep in mind that if your mom should apply for LTC Medicaid to pay for her NH, she is required to do a copay of basically almost all her monthly income to the NH. She is allowed for most States a max of $2,000 in non exempt assets. So any outstanding bills over 2k she will not have the $ to pay. That attorney will expect to be paid & I’d suggest you make his bill a priority.

Oh Kat, that is such great news.

I know this has been brutal on you but, you have done a hard job well.

I pray that your mom gets the care she needs, adjusts well to her new home and you find peace and can just be her advocate and not her scratching post.

Katsmihur, I read your update, wishing you and your mom peace…

Katsmihur: Hopefully the attorney has now resolved your issue once he was done traveling.

Its been 12 days, have you been able to do anything.

If I understand the issue, I’d be adamant the new company understands they are at fault for sending docs to your mom instead of you, when you are your moms legal representative as noted in the transferred paperwork. That way, any delays are on them & I would, in your shoes, demand the ticking clock resets (which gives you time to tell them mom lives in the house and averts foreclosure). Good luck!

PS. DOCUMENT! DOCUMENT! DOCUMENT! Every call with an email saying here’s what was said, every fax with a receipt the fax went through, every mailed letter with USPS confirmation.

Please consult with an Elder Law Attorney, to read her contract. I always thought the assurance of not having to leave your residence was a big selling point............this needs an attorney to read and clarify this "final notice" letter.

One very good option is to contact your state Attorneys General office, toll free. They have consumer protection and advocacy services that could help and their intervention / mediation services do not cost like attorneys do. Look over the website info and then call to talk to a consumer advocate. Best to have your mortgage docus ready to send as pdfs for their immediate review. These will show that you DPOA papers were attached and missed in the transfer.

That POA paperwork should have transferred with the mortgage and had the mortgage companies done their due diligence, your mom would not be in this emergent situation. It's not her fault, it's malfeasance on the part of the selling and receiving mortgage companies. Wall Street does not care, it's all just commodities trading to them.

Wishing you the best in pulling this back from the brink.

Kats, if the lawyer you speak of is mom's lawyer, I would be either in her/his office or sending certified mail indicating that mom is ignoring vital legal communications and seeking advice on how to proceed so that she doesn’t end up on the street.

Kats, hopefully this is just a clarification that she still is occupying the house full time and once they get your fax it will be no longer any issue for the RM or the new service provider for the original RM.

But something FreqFlyer touched on us important, your mom has to make sure that “occupancy” is the only issue. The RM has other items that must be satisfied for the RM to stay in force in addition to FT occupancy. She has to be current on property taxes and be fully insured with homeowners policy and any other hazard policy needed for your area (like flood, windstorm) AND maintenance and necessary repairs done on the property. I’d be concerned that if there are issues in using the front door and it’s obvious that this becomes an issue for the RM. That if they find this out as the process server who left the Notice wrote any of this up in his delivery of service report, that RM will send out someone to do a evaluation on condition on the property.

RM can be ruthless on calling in loans. They DNGAF what the occupancy is if there can be another reason to call in the loan.

After Hurricane Katrina, couple of our friends had parents in the Lakeview area of New Orleans with RMs. This area built in 1950’s and mainly slab on grade. LSS it flooded 6’ -14’ and stayed flooded for weeks & it was around Thanksgiving when it was kinda drained. RM sent out letter #1 & #2 to the property address which were returned undelivered to RM. Letter #3 which got forwarded basically was a 30 day demand letter to provide to the RM in detail all info on insurance claim, details on repairs status and with contractors info, info on utilities. It was chaos and no way to do any of this. The RM had zero interest in dealing with any Katrina drama or hear tales of woe from elderly parents or their kids and RM were going to foreclose. To cut losses and foreclose is their playbook. Please please realize this & watch what you or your mom let them know about.

If the current housing market drops out, and if your moms place is worth way less than the RM could ever get to repay their lending, imo, they are going to want to dump that property asap. & can find a reason to do this.

If you have the fax number, I’d suggest faxing a letter stating that she is living in the house and signed as her POA. Keep a copy of the letter and the fax confirmation for your files. Likewise keep notes on any phone conversations with names and dates.

Follow up with the form as soon as possible, of course.

Can you set up informed delivery with the post office so you can have a chance to see images of mail pieces that are being delivered?

Yes you need to contact the Mortgage Co. I would think the document would have to be handed to the person and signed for. Mom must not have answered the door. I am with Barb here.

Mortgage and loans are often sold, and unfortunately there is often no transfer of papers. This is something you can handle as POA and will have to resend the documents. Reassure them that Mother is still occupying so that the automatic machinery doesn't get started. These days everything is automated by computer and once started can be difficult to stop. It's important this company have your POA and your ability to act for Mom as well as you being contact person. At some point you may need to change all Mom's mailings to you by forwarding. I don't understand how such an important document is pulled from the door by a neighbor, nor how it got stuck at the door. I sure wish you the best. Do establish your POA. I would not say you HAVE to act for Mom now, but simply that you are doing so. Ask that all mailings come to you, or that you receive copies of any mailings. Sure wish you the best.

Katsmihur, I believe this is a legal document that certifies that the owner still resides in the home, and isn't living elsewhere. The mortgage company will send the document to the homeowner around the anniversary date of the reverse mortgage, and the borrower must return it signed in a timely fashion, typically within 30 days.

Being this notice is listed as "Final" makes me think that your Mom hadn't paid attention to the previous notices.

Call the mortgage company immediately to make sure it is just an occupancy document.

Definitely make contact with them. What will happen is they will go with a sheriff and put new locks on the doors. There does not have to be the fomality of eviction done either and she does not have squatter's rights. They may make a deal and give her a little time to get her stuff together, but they don't have to. Not applicable in a reverse mortgage situation. It's more like when a person stops making payments on a car. They come and repossess it. They just come and get it. The same will happen with your mom. When she goes out they will put locks on the doors and keep all the contents of the house too.
Yes, do call the reverse mortgage company immediately.

Are you still in contact with APS?

If she isn't responding to an important legal requirement like this, it seems like it might be evidence of incapacity.

Contact the new RM company with your POA. Ask THEM in writing to report mom's non-resonse even though she is present in the home.

Reverse mortgages are sold to different companies quite often. Im assuming her mortgage in default? You should contact them&provide the POA. My sister is moms DPOA & they never contact her for anything. Mom has a RM but doesn't owe anything on it.

What does her contract or the required pre contract counseling documentation say will happen?

I’m guessing that they send it to the house so the occupant will be responsible for receiving it.

If no response, the mortgage holder will follow the process to force a sale and any money received from the sale in excess of the debt will go to Mom or her estate.

The POA may have the motivation and ability to get a higher sale price if they sell before being forced to, so you should investigate the outstanding debt, current market value, and likely sales expenses to see if there any equity to maximize.