The purpose of a reverse mortgage is to allow a senior to pull out the equity in his or her home to meet his or her living expenses. In theory the senior does not have to ever pay back the loan. When he or she dies the home will be sold to pay back the mortgage, however, this is not always the case.
Foreclosure and Reverse Mortgages for Non-payment of Real Estate Taxes
A homeowner in a reverse mortgage must pay his or her real estate and school taxes. The non-payment of real estate taxes gives a financial institution the automatic right to bring a foreclosure lawsuit. Banks will bring these non-payments of real estate tax foreclosure proceedings to protect their mortgage interests in the house.
The mortgage creates a first lien on the property. However real estate taxes have a superior interest to the mortgage holder with regard to the property. Therefore if the homeowner fails to pay their real property taxes the municipality, city or town can bring a non-payment or tax foreclosure proceeding against the homeowner. In this case, the interests of the municipality to pay their taxes, is superior to that of the mortgage holder. Therefore when the taxes are not paid the institution holding the mortgage often is forced to bring a foreclosure case to protect their interests.
Elliot S. Schlissel, Esq. and his associates defend homeowners in tax foreclosure cases throughout the Metropolitan New York area.
