Reverse Mortgages With Non-Borrowing Spouses Are Still Possible
The fastest way to apply for a reverse mortgage is with both senior homeowners to qualify and be on title of the house. However, there are still ways to qualify for a reverse mortgage even when one spouse doesn’t qualify as a borrower for a reverse mortgage.
PS Financial Services follows new guidelines as a safeguard for senior households with both a borrowing and non-borrowing spouse, ensures senior homeowners are aware of the rules and regulations when applying for a reverse mortgage.
Very few companies still offer Reverse Mortgages for borrowers with Non-Borrowing Spouses (NBS). At PS Financial Services, a reverse mortgage company in Florida, we DO offer NBS Reverse Mortgages.
As a modification to the non-borrowing spouse or non-borrower certification guidelines, regardless of whether or not the non-borrower/spouse has ever been on title or live(d) in the property that is used for the reverse mortgage, the following documentation is required:
Letter of Explanation: A letter signed by the borrowing AND the non-borrowing spouse explaining their reason for excluding the non-borrowing spouse from the loan. This letter must be notarized at or before the closing of the loan.
Attorney Letter: A letter from a licensed attorney stating the attorney explained to the non-borrowing spouse that, upon the occurrence of any of the following events, the loan must be fully repaid and the lender may foreclose on the property and evict all resident, including the non-borrowing spouse.
The letter must also state the attorney explained and the non-borrowing spouse expressed his/her understanding that he/she could never become a borrower on this loan if removed from title, even if they were later put back on title (but the NBS can refinance into a new HECM once 62 and with enough equity).
There is no guarantee of a refinance in the future. The non-borrowing spouse must waive any right, including those believed to arise from homestead or community property rights, to remain in the Property or to contest a foreclosure arising from an uncured default by the borrower(s).
The non-borrowing spouse must acknowledge an understanding of the consequences and consent to the spouse moving forward with the loan.
- Non-Borrower Certification – All non-borrowing spouses must submit the fully completed, signed Non-Borrower Certification.
- In Community Property States – Non-Borrowing spouses must submit a fully completed Credit Authorization Form.
If ALL of the applicable documents are not submitted, Generation will not allow a loan to proceed with a non-borrowing spouse.
This policy does not affect the existing requirement that the non-borrowing spouse attends Home Equity Conversion Mortgage (HECM) counseling, and submit a signed counseling certificate.
These new regulations ensure smoother transactions for all those involved. Give us a call at (888) 845-6630 or email us at info@PSReverseMortgage.com. We do not pressure those who inquire nor is there an obligation for our services, we are simply here to help.