daisymay

What can we expect from mortgage lender/underwriters when SOL CO's exist?

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Mom has several SOL CO's on her CR and some of those were sold to CA's. Plus 1 CA got a default judgment on her 2 years ago but it was paid off 1 year ago. We were able to clear some of her prior delinquencies but the others wouldn't budge and are now SOL (California has a 4 year SOL). She currently has 1 open account that she has never been late on (several years now). Her mid-range score is running in the 620's now.

Her home is paid off. It needs repairs badly. We're going to see if she can get a equity loan but a low mortgage may be better yet since there is no existing mortgage.

What can we expect lenders to say regarding the CO's and CA accounts on her credit report?

Does it make a difference if the SOL has run, or will they require her to pay the CO's anyway?

If so, what should we do about the CA's when we already sent them letters to C&D because it was SOL?

Would reverse mortgage be viable for her? If so, what can we expect re the CO's?

Lots of questions, I know...but your insight would be terrific!

Thanks!

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A reverse mortgage will probably be her best option, but for the best deals, part of the deal will probably be that it be fixed up to meet FHA requirement for property.

Depending on the condition of the home she could also qualify for a low Loan To Value (LTV) loan.

Charles

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Mom is 74 so she'd meet the age requirement. I know very little about reverse mortgages, the pros and cons... I don't know what an LTV loan is...is that a type of mortgage loan or like a regular equity loan?

I'm going to check into these suggestions more, but would appreciate more insight into these options!

Thanks for your responses!

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Mom is 74 so she'd meet the age requirement. I know very little about reverse mortgages, the pros and cons... I don't know what an LTV loan is...is that a type of mortgage loan or like a regular equity loan?

I'm going to check into these suggestions more, but would appreciate more insight into these options!

Thanks for your responses!

Read all the fine print on the reverse mortgage.

in a nutshell, If the house is worth 100K, she might be able to get 60K.

when she dies, the heirs (you) can either pay back the 60K in a single transaction or get a loan to pay it back (mortgage), or you can simply walk away and let the bank have the house.

Your mom will never be kicked out of the house, but when she dies, the bank gets it if you don't pay it back.

The way I look at it - no one is entitled to an inheritance. Your mom shouldn't feel obligated to leave the house to anyone. Rather, she's 74 years old. she may only get 60K for a 100K house, but she gets to live rent free (still needs to pay taxes and insurance I think) and she gets to enjoy the money while she's alive and she needs it.

It makes a lot of sense in a lot of situations, but read all the fine print and make sure you understand it.

This might be one of those situations where I'd recommend a lawyer look at the papers to explain everything and make sure everything's in order.

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Mom has several SOL CO's on her CR and some of those were sold to CA's. Plus 1 CA got a default judgment on her 2 years ago but it was paid off 1 year ago. We were able to clear some of her prior delinquencies but the others wouldn't budge and are now SOL (California has a 4 year SOL). She currently has 1 open account that she has never been late on (several years now). Her mid-range score is running in the 620's now.

Her home is paid off. It needs repairs badly. We're going to see if she can get a equity loan but a low mortgage may be better yet since there is no existing mortgage.

What can we expect lenders to say regarding the CO's and CA accounts on her credit report?

Does it make a difference if the SOL has run, or will they require her to pay the CO's anyway?

If so, what should we do about the CA's when we already sent them letters to C&D because it was SOL?

Would reverse mortgage be viable for her? If so, what can we expect re the CO's?

Lots of questions, I know...but your insight would be terrific!

Thanks!

I personally don't like reverse mortgages, but in some cases then might serve a purpose for others. The banks fees are excessive, you can choose to receive your money up front, or receiving monthly payments. Frankly you are giving up alot more then what you getting in return.

I don't want to be banned by recomending banks. At 74yrs of age should not hold you back from qualified for refinancing. (last year did 30yr mortgage for 84yr old no problem).

Have you thought about helping her, by going on the loan with her. That why you will be on the title, and the house can stay in the family. This will save you on the probate fees when she passes (sorry to be direct).

...:)

..

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Thanks to both of you for taking time to share your thoughts and suggestions!

I'm not sure how mom would feel about putting us on the title...right now she sees the house being her only real asset, something that's hers alone. In the past we've asked her if she'd thought about setting up some sort of trust, she didn't seem receptive to the idea of the house being in a trust's name instead of hers individually.

The intent behind a reverse mortgage (for her) would be for her to repay the amount over time, and not give it to the bank when she passes. If that happened before she repayed it, we (her kids) would arrange to pay it off instead of giving it to the bank.

Thanks again!

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