Must I pay property taxes, HOA fees, and home insurance DURING the months long foreclosure process of a reverse mortgage?

Asked about 2 years ago - Honolulu, HI

My mother had a reverse mortgage with Financial Freedom. She died in September 2012 and the property is upside down. My sister and I are the heirs and do not want the property; we want to "walk away." Our attorney is telling us to do a short sale so that we won't have to pay property taxes, HOA fees, and home insurance during the months-long process of Financial Freedom foreclosing on the home. I am wary of that as he (attorney) is heavily pressuring us to do the short sale (benefit to him in some way?) We would like to let Financial Freedom handle it all IF we know we won't have to pay the taxes, HOA and insurance until the deal is done. Please adviseā€¦can't sleep!!

Attorney answers (1)

  1. Frank A Selden

    Contributor Level 16

    Answered . the owner is responsible for such taxes / fees. Therefor, the longer the sale is drawn out the more the owner will owe. If you do not receive the property from the estate (do an estate short sale, for example) then you will not be the owner responsible for these costs. You do not have to follow the attorney's advice here. However, I do believe there are rational reasons for that advice, rather than self-interest reasons.

Related Topics

Property foreclosure

If you miss too many mortgage payments, your lender can start foreclosure proceedings to take ownership of the property, but it has to follow your state's laws.

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