Reverse mortgages, sinkholes or lightning losses...what happens?

[manaboutown]

According to Wade Pfau, a natural disaster (such as a sinkhole or a lightning strike) could cause a reverse mortgage to become due and payable.

On page 132, of his book, "Reverse Mortgages, 2nd edition", Wade addresses dealing with natural disasters:

"However, the loan balance could become due and payable if one has insufficient insurance to rebuild or decides to move to a new location because it is impossible to rebuild on the same property."

Now that is a scary scenario given the sinkhole and lightning events that occur within The Vilages!

[Stu from NYC]

I wonder how cousin brucie would belittle you if you posted this on one of his many many threads.

thanks for sharing though

[Plinker]

I wonder how cousin brucie would belittle you if you posted this on one of his many many threads.

thanks for sharing though

Well, we now know he is an expert on managing home foreclosures, tax liens, law suits and bankruptcy. He would just walk away. He doesn’t seem to be too concerned about his creditors.

[Dotneko]

I find your (general) love/hate relationship with him amusing. You get angry that he posts, and then you go and dare him to reply. Make up your minds. I understand it is a sport for you, but you are more annoying than he is.

[Toymeister]

To bring perspective, Wade Pafu is often touted as a Reverse Mortgage 'expert'. In fact he operate a financial services company which sells RMs annuities and other financial products. He is in a position to sell you what you need, but the annuities and RM salesman like to quote him to sell their products.

[DIY&Save]

I find your (general) love/hate relationship with him amusing. You get angry that he posts, and then you go and dare him to reply. Make up your minds. I understand it is a sport for you, but you are more annoying than he is.

I’m pretty sure there is no anger involved. I do agree that it is sport as the RM salesman continues his campaign of deception and denial. I certainly don’t find his factual responses annoying.

[Mohawksin]

I’m pretty sure there is no anger involved. I do agree that it is sport as the RM salesman continues his campaign of deception and denial. I certainly don’t find his factual responses annoying.
No, but his responses are a terrible waste of electrons.

[joseppe]

According to Wade Pfau, a natural disaster (such as a sinkhole or a lightning strike) could cause a reverse mortgage to become due and payable.

On page 132, of his book, "Reverse Mortgages, 2nd edition", Wade addresses dealing with natural disasters:

"However, the loan balance could become due and payable if one has insufficient insurance to rebuild or decides to move to a new location because it is impossible to rebuild on the same property."

Now that is a scary scenario given the sinkhole and lightning events that occur within The Vilages!

Isn't the same true of a regular mortgage? If you are underinsured and can't rebuild you'd still owe the mortgage wouldn't you? A RM is still just a mortgage. If you loose the collateral the debt could become due and payable with any mortgage or collateral based loan.