Millardray (November 30, 1999 at 12:00 am)

The person I talked with a HUD just called me back this a.m. to say he was wrong. HUD does not compell lender to call reverse mtg when you go bankrupt. It was a predatory lender who inserted that condition into my contract. HUD rules require the person to do a Chapter 13 wage earner first, then go into Chapter 7. But, he said, if the lender has a provision in the contract that bankruptcy would cause the loan to be called, then the lender would have the discretion under contract to do that.

Millardray (November 30, 1999 at 12:00 am)

But... if property taxes go up and insurance goes up, and they cannot pay those items because of jobs going down and electric bills going up, and gasoline for their cars going up so that they can't work, job losses, etc.... what then? They could be in the street.

HOOLOHA (November 30, 1999 at 12:00 am)

I am sorry to hear your sad story.The good thing about Reverse Mortgage is that borrowers can stay in their home without worry about making monthly payment.

HOOLOHA (November 30, 1999 at 12:00 am)

The Truth to it is the Credit Card Companies have made alot of money by charging high interest. If they can not collect the money they would sell the debt to collecting agencies. This is when the harassing phone calls begin!!! File Bankcuptcy would damage your credit as much as other choice of debt reduction.

Millardray (November 30, 1999 at 12:00 am)

I absolutely spoke with a representative of the Program for Reverse Mortgages at the HUD office and they absolutely told me that if I go into bankruptcy after the Rev.Mortg the HUD programs compells payment and there is no ifs - ands - or buts about it. It is in the law which is also carried over into the contract with the lender that you sign when you get the contract. I am not "guessing." That's official info. HOOLOHA your strategy sounds like my only choice on debt reduction - blow-em off.

HOOLOHA (November 30, 1999 at 12:00 am)

This is new to us. We do know that Bankcruptcy have to be paid off before one can get Reverse Mortgage. Did you try to request the guideline from HUD or FHA regarding Bankcruptcy? Please continue to share your story with us.

HOOLOHA (November 30, 1999 at 12:00 am)

ReverseMortgage is secured debts(Your home is security for the lender)Most of Credit Cards or other debts are nonsecured debts;they normally have high interest rate because lenders are taking the default risk(borrower might not payback.)Some people would in situation where they own too much on the Credit Cards is to closed the accounts that reach the limit;negotiating with Credit Cards Company few years later to pay less instead of filed Bancruptcy.Try to avoid harassing phonecalls from Co.Agen.

Millardray (November 30, 1999 at 12:00 am)

Not yet. I have been contacting all agencies including HUD and they tell me if I go Bankrupt FHA HUD program compells the lender to call my loan. I am in finacial trouble now and threatened with bankruptcy, and I have been told my loan will be recalled and I must pay it off. It's the law. So, I don't know what to do. Terrified.

HOOLOHA (November 30, 1999 at 12:00 am)

Did this really happen to you or you have heard from someone else?

Millardray (November 30, 1999 at 12:00 am)

Dooms Day Scenario - HUD regulations compell lenders to "call" the loan if, after you have the reverse mortgage, you fall into bankruptcy. So your property is no longer protected under your state's bankruptcy laws. So be careful if y ou have financial problems because neither nor the counsellors warn you about that BEFORE you take the reverse mtg.