If you have a client with an underage spouse who’s not on the reverse mortgage, it may still be possible for that person to continue living in the home after the borrower has passed away or resided in a healthcare facility for more than 12 consecutive months.
To qualify as an Eligible Non-Borrowing Spouse, the underage spouse must:
- Be current in making timely tax and insurance payments;
- Maintain the property under the terms and conditions of the HECM;
- Be legally married to the borrower of record when the reverse mortgage originally closed OR engaged in a committed same-sex relationship with the borrower akin to marriage but was prohibited under state law at origination, but became legally married prior to the death of the borrower; and
- Live in the property as a principal residence throughout the duration of the HECM.
Unfortunately, if someone does not qualify as an Eligible NBS, the reverse mortgage
will become due and payable and the spouse will have to find a way to pay off the loan or sell the property and find alternative housing. It’s important that your client contact the Loan Servicer and find out what their options are.