Reverse Mortgages: Seniors Now Expected to Pay Taxes and Insurance

The FHA and Fannie Mae to crack down on seniors owing taxes or insurance
The FHA and Fannie Mae to crack down on seniors owing taxes or insurance

Do you or your parents have a reverse mortgage for which they don't pay the property taxes or insurance? While in the past, the FHA and Fannie Mae would patiently wait until the property owner died or moved to pay off any liens, that practice is about to end.

Many seniors don't realize that they can lose their home to foreclosure if they have a reverse mortgage, since no payments are due. They just assume any past-due taxes or insurance will be paid when they die.

While that is how it's worked in the past -- even though it wasn't really supposed to work that way -- the practice is ending.