[WSBAPT] Reverse mortgage, death of parent, lack of probate and practical advice!

[Richard Wills]

*Assuming the condo is underwater & the estate as a whole is insolvent:
Don't open a probate.**
**Don't contact the mortgage lender.**
**Stay in the condo until the buyer at the foreclosure sale threatens to 
evict.**

I've had numbers of these, & typically, foreclosure doesn't occur for at 
least a year after the D's death --- & often much longer (I've had some 
where it's truly been years).  Meanwhile, at least in my experience, the 
tenant effectively has rent-free use of the property.**  The downside to 
this is that if they continue to use the property, they're liable for 
it, eg, for waste etc.  Therefore, it's often a good idea to retain 
insurance on the property --- for example, if the property (eg, a home) 
burns up, is vandalized, etc., **the insurance should protect the tenant 
from any claim for damages.*


On 3/13/2015 11:59 AM, Sarah Jael Dion wrote:
> Hello listmates!
>
> I am debating how to advise a client in the following situation, and 
> would be appreciative of thoughts/ideas from anyone with knowledge to 
> share!
>
> Client’s mother died at the end of 2014. Client recently hired me to 
> assist her. Client has not opened probate. Client is a very nice 
> woman, but is rather delicate in nature and is easily overwhelmed.
>
> Client’s mother owned a condo where she lived with client, and where 
> the client still resides. The mother took out a reverse mortgage, 
> which became due upon her death. Client would like to buy the property 
> back from the reverse mortgage company, but for a variety of reasons, 
> has realized she will not be able to do so. The only asset in the 
> mothers estate is the condo and it appears that the reverse mortgage 
> is for more than the condo is worth. The reverse mortgage company will 
> not communicate with me or my client because we do not have letters 
> testamentary from the probate court.
>
> The estate is insolvent, which means that opening probate would be 
> especially $$ and would only benefit the reverse mortgage co. My 
> client ideally would like a little more time to remain in the condo, 
> but I don’t want her to run afoul of anything.I am thinking of 
> advising her to (1) call the reverse mortgage company and tell them 
> that they should go ahead and foreclose, and (2) just walk away from 
> the whole situation without opening probate. Does anyone see a problem 
> with that? If we go that route, may she just remain in the condo for a 
> few months as the bank does what it needs to do, or must she evacuate 
> ASAP?
>
> Are there other suggestions for action my client could take?
>
> Thanks in advance for any ideas!
>
> Sarah Jael Dion
>
> Dion Law PLLC
> 206-550-4005
> sarah at dionlaw.com <mailto:sarah at dionlaw.com>
> dionlaw.com <http://dionlaw.com>
>
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