Little Known Mortgage Fact!

Little Known Mortgage Fact!

Hey everyone, Mortgage Nerd here! Just had a client call me who’s selling his house. He did a reverse mortgage with me many years ago, almost 10 years ago, and he says that the current title company that’s helping him sell his house says: “Why is there a second mortgage? Who’s the second mortgage that’s housing and urban and development?” So of course the client calls me, he’s like: “What is it?” I said: “Don’t worry about that, the title company obviously does not understand reverse mortgages or has not worked with them…”, I should say, and they don’t realize that HUD (Housing and Urban Development) puts themselves in second position on a reverse mortgage. So you have your first mortgage, which carries a balance, that’s your reverse mortgage. Then in second position, there’s a second mortgage, reverse mortgage. It’s not a “silent second” cause it’s a different meaning to it, but it’s a second that does not do anything. There is no balance on it. Basically, if you wanna go out and get another mortgage, after you have a reverse mortgage, (I’ve said mortgage so many times) you have to get it in third position. No one’s gonna want to put their lien on your property in third position, they’ll never get their money back if you go into foreclosure. So that was my answer to him. Very easy, very quick. Most people don’t know it cause most people have no idea even how reverse mortgages work or that there is a second mortgage as that title company has come to find out! Mortgage Nerd out! Thanks.