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Reverse Mortgage on a House in Foreclosure

by Michelle
(Northern NJ)



I will be 62 in January 2012. We have a mortgage with my sister for 75K. The house was for sale, but we just found out it has a cesspool and will not get a CO unless I upgrade to a municipal sewer. The price to hookup is around $45K as there is not sewer line near me. Also we must obtain DOT permits as access in on a state highway. We don't have the money to pay her. We have been unemployed since 2010 and can't find a job.

What are my options?

=====ANSWER======

Hello Michelle,

As I look over your situation, I have to ask myself, if I was in the same situation, what would I do.

Given that I have knowledge on how the mortgage market works and thinking about this, I must say I'm at a dead end.

It appears from your subject line your sister may have a reverse mortgage on this house. So that means she is collecting money each month on a house that is paid off and will be leaving it to you.

Then if I understand this right, you have a land contract with her for $75,000. You both have decided to sell the house and now find out the sewer system is outdated and needs to be improved before you can sell it.

And it appears that you have found out that it will cost more than the house is worth to improve the sewers.

If all of these things are correct, and when we factor in that you are unemployed and cannot afford to buy the house let alone upgrade it, well that appears to be a very hard situation.

You may need to be looking for a place you can move to and rent. I cannot see any other options for you.

Your sister may end up losing the house in foreclosure. There does not seem much that be done here.

I'm really sorry for your situation, I wish I could offer you some advice on how to buy the house, improve it and stay living there. I just do not see how that can happen.

I wish you the best. Thanks for stopping by my site and asking a question.

Kind Regards,

Jeff Ragan


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