Hello Jeanice, The rules you reference refer to the payoff of loans that have not yet gone through foreclosure. They allow the borrower's heirs to repay the loan's outstanding balance at the lesser of the amount owed or 95% of the current market value. With this option, heirs can keep the home and pay the balance in full for no more than 95% of the home's current value, regardless of what is owed if the balance is more than the current value. For example, if you were the heir (and I say "if" because I don't know if you have other siblings or if there are other family members who may have had claim to the title) and had contacted the lender before they foreclosed and took title to the property, you could have paid off the loan and kept the home for the amount owed or 95% of the value at that time, regardless of the amount owed if that was less than the full balance of the loan. For example, If the loan balance was $200,000, but the property was only worth $180,000, you could have paid the loan in full for 95% of the $180,000 or $171,000, even though that was almost $30,000 less than the amount owed. You didn't have to wait and "buy" the home; you already owned it at that point if you were the heir, and you just needed to make arrangements to repay the outstanding reverse mortgage by the options available to you at that time. If other family members were your parent's heir(s), the best thing to do would have been to get them to sign the property over to you before the foreclosure so you could have paid the loan off at the amount owed or 95% of the market value, whichever was less. However, once the property goes through a foreclosure and the title to the home is no longer in the borrower's name or the name of the estate or an heir, there is no longer a right to pay the loan off at any set amount. If it is now a real estate-owned piece of property that the lender or HUD owns, it will be sold at whatever price the lender deems appropriate with HUD's approval. HUD will need to pay a claim on the loss, so the lender must get HUD's approval on any sale lower than the amount owed on the loan. Suppose the price you wish to pay is now below 95% of the market value at the time of the passing of the borrowers. In that case, neither HUD nor the lender are obligated to sell the home at any price now, let alone one below 95% of the previous appraisal they had obtained. Would they be wise to sell it to you if values had declined since their last appraisal? I believe it would be wise for the lender and HUD to sell the property at its current market value, so it may well be in your best interest and theirs to keep attempting to purchase the home if you want it. The price you want to pay is close to what other similar homes are selling for now. The realtor may be correct, but have you prepared and presented an offer? It could very well be that the bank and HUD have received appraisals upon which they rely to determine their lowest acceptable price. Still, the only thing they can do if they don't like your offer to counter your offer with a heftier price is to accept, deny, or turn it down. Either way, there is nothing lost by submitting an offer except a bit of time, and if the agent you spoke with did not submit the offer you want to make, my advice would be to talk to another agent. If the person you are talking to is the listing agent discouraging an offer because others have been denied, I would go to another agent who is not with the listing broker and have them write the offer. They should be more aggressive because they don't have the listing, and the only way they would be paid on this transaction is if the sale goes through (you do not pay them a dime; they are paid through the listing fees).