questions & answers
Question: Can HUD or FHA garnish my Social Security and Honeywell Pension for expenses if my Reverse Mortgage defaults?
A reverse mortgage is a specific type of mortgage for persons 62 and over that pays them from the equity accumulated in their homes. Most reverse mortgages are "non-recourse" loans, the lender only has a security interest in the property. This means that in the event of a default, the lender's only remedy is to foreclose on the property. If a borrower were to default on a reverse mortgage that is classified like most as being "non-recourse", the lender could only institute a foreclosure process to collect the money owed. In this scenario, the borrower would not be personally responsible for any amount of the reverse mortgage not paid by the foreclosure. If a borrower is in danger of default he or she should determine if the borrowing agreements contain a "non-recourse" clause, additionally there are resources that may be able to help a borrower avoid default. The Consumer Financial Protection Bureau has information on Default, and Counselling resources. There is also useful information regarding reverse mortgages on the Federal Trade Commission's website.
Can HUD or FHA garnish my Social Security and Honeywell Pension for expenses if my Reverse Mortgage defaults?
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