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IMPuzzled

Reverse mortgage off grid "non-conforming"

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I'm 66 and I've just built a home valued at approx. $650,000.00 with no mortgage or debt. I'm trying to apply for a reverse mortgage, but I'm being turned down because I'm "off grid " although I have a state of the art generating system. I've been told I'm "non-conforming". Am I being discriminated against and do I have legal recourse?

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I've just built a home valued at approx. $650,000.00

Who says it's worth $650k?

Am I being discriminated against

Obviously. However, in the event you are not aware, most discrimination is perfectly legal, and nothing in your post suggests you are being discriminated against for any unlawful reason.

do I have legal recourse?

I have no idea because I have no idea what you mean by "off grid" and "non-conforming." Care to clarify that?

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Off grid means simply that I'm located beyond a community power supply. Non- conforming is the excuse I've been given by representatives of the FHA meaning (I suspect) I don't qualify for the program because I'm not "On grid". I'm in a subdivision in the Colorado mountains with many homes from a cabin to million dollar homes. Non- conforming?

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Of course, I understand , from the standpoint of the FHA, that it's legal, but does that makes it morally right to deny me from the right to receive a reverse mortgage just because I'm supplying my own power? Do I have recourse?

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Of course, I understand , from the standpoint of the FHA, that it's legal, but does that makes it morally right to deny me from the right to receive a reverse mortgage just because I'm supplying my own power? Do I have recourse?

No recourse.

There's no illegal discrimination.

You don't have the "right" to a reverse mortgage or any loan at all.

When you want to borrow money you have to meet the lender's qualifications for the loan.

That's the long and short of it.

Your option is to apply to other lenders who might not share those limitations.

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Of course, I understand , from the standpoint of the FHA, that it's legal, but does that makes it morally right to deny me from the right to receive a reverse mortgage just because I'm supplying my own power? Do I have recourse?

This is FindLaw.com, not FindMorality.com, and the law does not provide recourse for things that are legal but arguably not "morally right." If a particular lender doesn't want to extend a reverse mortgage because you don't live in an area where you get power from a power company, that's entirely up to the lender. I don't know why a lender might do that, but it's certainly not illegal (and I wouldn't say that it has anything to do with morality either). Sorry.

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I was just hit with the ultimate hammer by the FHA, I live in a non-conforming community, a large Condo development. Why do we not conform? Due to the large number of foreclosures during the housing crash, speculators rushed in here and bought up 70% of the units and rented them out to many tenants who have no interest in maintaining their property or or even common decency or neighborly respect. I don't know the FHA conforming ratio of Owner Occupied vs.Tenant Occupied but  I do know that 70% tenant occupied means we are in deep, deep trouble.

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It's not entirely clear why you paid cash to build the house instead of getting a traditional construction loan and mortgage, and meanwhile putting the money to good use.  It may be that you should be angling for a "regular" mortgage or HELOC if you need dough.

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You may be interested in visiting the Real Estate Law Center: Mortgages and Equity Loans and reading A Reverse Mortgage Guide as a good resource. If you need further clarification on your specific situation, you may consider signing up for a LegalStreet plan. With the plan, you have unlimited access to a local lawyer to ask your questions and the plan also offers discounted legal representation should you need it.

Disclosure: LegalStreet and FindLaw.com are owned by the same company.

 

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