Imagine you’re a senior who has just lost your spouse. Soon after their funeral, while still grieving, you receive a letter in the mail, informing you that because your spouse passed away, you’re also going to lose your home to foreclosure.
Unfortunately, this horrible scenario is not imaginary- it has been happening to senior homeowners across the country due to reverse mortgages that were originated to only one spouse. If that “borrowing spouse” passed away, banks and servicers were foreclosing on the non-borrowing, surviving spouse, who in many cases was a younger wife. The idea that a surviving spouse could lose the family home is a scenario the vast majority of these couples never anticipated or understood when they originally looked at a reverse mortgage.