Home / Questions / Do Heirs Over 62 Have Special Occupancy Rights in a Reverse Mortgage Home?

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From America's #1 Rated Reverse Mortgage Lender

My mother owns a reverse mortgage home. My brother (age 62+) has been living in the home for 10+ years. He is not a co-borrower. Mom recently passed away. My brother wishes to exercise some sort of occupancy rights extended to inhabitants who are offspring/heirs and greater than 62 yrs old. We’ve been told this relates to a new rule in effect in CA. Is any part of this a real thing or is it 100% fiction?

By Joanne T. on 01.04.2019

Hello Joanne,

There are no special occupancy rights for heirs of a reverse mortgage borrower. Once the last original borrower no longer lives in the home as their primary residence, the loan becomes due and payable—regardless of the heir’s age or how long they have lived in the home.

What Are the Heir’s Options?

As an heir, your brother has the same choices as any other heir in this situation:

Keep the home by paying off the reverse mortgage balance (through refinancing or other funds).
Sell the home and use the proceeds to pay off the loan.
Walk away, in which case the lender will foreclose, and no personal debt will be owed.

Can Your Brother Get a Reverse Mortgage on the Home?

Since your brother is 62 or older, he may be able to take out a new reverse mortgage in his name—but only if he owns the home. Here’s what he needs to consider:

The amount he qualifies for depends on his age, the home’s value, and current HUD lending limits.
His mother likely received a higher percentage of the home’s value due to her older age.
If the new reverse mortgage amount isn’t enough to cover the existing loan balance, he would need to bring cash to closing to complete the refinance.

The best way to determine eligibility is to use our reverse mortgage calculator and assess whether refinancing is a viable option.

Is There a New Rule in California?

We are not aware of any new rule in California that grants heirs or occupants over 62 the right to remain in a home with a reverse mortgage.

If your brother does not own the home outright (meaning other heirs are also on the title), he would need to buy out the other heirs to obtain financing in his name. Otherwise, securing a loan would be difficult.

Bottom Line

No special occupancy rights exist for heirs of a reverse mortgage home, even if they are over 62.
Your brother can only stay in the home if he pays off the loan—either by refinancing, selling, or using other funds.
If he is not the sole homeowner, he may need to buy out other heirs to secure financing.

Also See: 6-Step Guide to Handling Reverse Mortgage Heirs & Estate Affairs

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