By Linda Reynolds, Broker, Reynolds Realty Gulf Coast (License #BK3021695) · Updated November 2026
Quick answer: For Palmetto and Manatee County families, a reverse mortgage (HECM) becomes due and payable when the last borrower dies. According to the CFPB, heirs generally have 30 days from the lender’s due and payable notice to buy the home, sell it or turn it over to the lender, and that window may be extended up to six months. If the loan balance is more than the home is worth, heirs who sell can satisfy the loan with at least 95% of the appraised value.
No judgment, just options. If you are one of the reverse mortgage heirs holding a due and payable notice, or you are helping a parent or spouse who may need to leave the home, the paperwork can feel confusing at an already hard time. I’m Linda Reynolds, and I help Palmetto and Manatee County homeowners and families understand their choices. If a mortgage payment is also behind, my free guide to your options covers that side of things.
A quick note on scope: everything below is about Home Equity Conversion Mortgages (HECMs), the FHA-insured loans that are the most common type of reverse mortgage, according to the CFPB. If your loan is a different type, ask the servicer for the loan terms in writing. This is general information, not legal, tax or lending advice.
What makes a reverse mortgage due and payable?
A reverse mortgage has no monthly payment, so the balance comes due when something changes. HUD describes the main triggers as the last borrower dying, selling the home, or no longer living there as a primary residence. The CFPB adds that a long stay in a healthcare facility can count too.
| What happens | What it means for the loan |
|---|---|
| The last borrower dies | The loan becomes due and payable. A co-borrower can stay if they keep meeting the loan’s obligations (CFPB). |
| The home is sold | The balance is repaid from the sale (HUD). |
| The borrower stops living there | If the home is no longer the borrower’s primary residence, the loan can come due (HUD). |
| Away in a healthcare facility for more than 12 consecutive months | With no co-borrower living in the home, the loan can come due (CFPB). |
| Unpaid property taxes or homeowner’s insurance | Florida Law Help lists these among the reasons a reverse mortgage lender can file a foreclosure case. |
What can reverse mortgage heirs do when the loan comes due?
After the last borrower dies, the servicer sends the estate or heirs a due and payable notice. HUD’s mortgagee letter says that notice must explain the choices: pay off the loan, sell the home for at least 95% of the appraised value, or give the lender a deed in lieu of foreclosure. In plain English, that comes down to three paths.
- Sell the home. If the home is worth more than the loan, you repay the loan and keep the difference. If it is worth less, the CFPB says heirs can satisfy the loan by selling for at least 95% of the appraised value, and the mortgage insurance the borrower paid covers the rest.
- Keep the home. You generally pay off what is owed, and you may need a loan of your own to do it. The CFPB’s pages are not fully consistent here: one says heirs must pay the full balance, another says the lesser of the balance or 95% of the appraised value. Ask the servicer for the payoff figure in writing and confirm the rule with a HUD-approved counselor or attorney.
- Deed in lieu of foreclosure. HUD’s heirs brochure lists transferring the property to the lender as a way to avoid foreclosure when keeping or selling the home isn’t workable.
On timing, the CFPB says heirs have 30 days after receiving the due and payable notice to buy, sell or turn the home over, and that the window may be extended up to six months. HUD’s brochure adds that a lender may approve 90-day extensions when the estate documents that it is actively trying to sell the home or repay the loan. Until title transfers, property taxes and insurance remain the estate’s responsibility. Timelines can vary by loan, so ask your servicer for the exact dates in writing.
A spouse who is not on the loan may be able to stay in the home. For HECMs with FHA case numbers assigned on or after August 4, 2014, the CFPB says the spouse generally must have been married to the borrower when the loan was signed, be named in the loan documents as a non-borrowing spouse, have lived in the home at closing, and keep living there while meeting the loan requirements. HUD’s brochure says the spouse must give the lender a Non-Borrowing Spouse certification within 30 days of the last borrower’s death, among other requirements. The CFPB notes that qualifying can be difficult, so an attorney or HUD-approved counselor can help.
What happens if a homeowner moves to assisted living or a nursing home?
Moving out does not make the loan due that same day. The CFPB says a borrower can be away in a healthcare facility, such as a hospital, rehab center, nursing home or assisted living facility, for up to 12 consecutive months. If the stay goes past 12 consecutive months and no co-borrower lives in the home, the loan can become due and payable. If a co-borrower lives there, they can stay and keep receiving loan payments as long as they meet the ongoing obligations.
If the move looks permanent, it helps to start the conversation early with the servicer and a HUD-approved housing counselor. There is usually more room to plan a sale on your own timeline when you begin well before the 12-month mark. It is also worth talking with the servicer and an attorney before anyone changes the deed.
What are the first steps for heirs in Palmetto and Manatee County?
Whether the home is in Palmetto or in Sun City Center, a calm checklist helps. Here is the order I suggest:
- Find the latest loan statement and the servicer’s phone number, and write down the date any notice arrives.
- Ask the servicer, in writing, for the payoff amount, the current appraisal, the deadline and how to request an extension.
- Keep property taxes, homeowner’s insurance and basic upkeep current while the estate decides.
- Talk with a Florida probate attorney about who has legal authority to sell or deal with the lender. Manatee County probate is handled by the Clerk of the Circuit Court’s Probate and Guardianship division at 1115 Manatee Avenue West in Bradenton, 941-741-4037. The Clerk’s site says the original will must be deposited within ten days of the death.
- Call a HUD-approved housing counselor at (800) 569-4287, or the FHA Resource Center at (800) 225-5342, for free guidance.
- Once you know what is owed, get a realistic picture of what the home could sell for so you can compare your options side by side.
If the home is in a 55+ age-restricted community such as Kings Point in Sun City Center, ask the association early whether it has any steps for a new owner or buyer. And if the home also has a regular mortgage, my post on what happens to the mortgage on an inherited house covers that situation.
Frequently Asked Questions
Does the lender take the home right away when a reverse mortgage borrower dies?
No. The loan becomes due and payable, which starts a timeline. The CFPB says heirs generally have 30 days from the due and payable notice to buy, sell or turn the home over to the lender, and that this window may be extended up to six months.
Are heirs personally responsible if the reverse mortgage balance is higher than the home is worth?
The CFPB says that when the home is worth less than the balance, heirs can satisfy the loan by selling for at least 95 percent of the appraised value, and the mortgage insurance the borrower paid covers the rest. Ask a Florida attorney how this applies to your specific situation.
Can a parent keep a reverse mortgage home while living in assisted living?
The CFPB says a borrower can be away in a healthcare facility for up to 12 consecutive months. After that, if no co-borrower lives in the home, the loan can become due and payable.
Do I need probate in Manatee County to deal with a reverse mortgage after a death?
Probate is the court process that oversees a deceased person’s estate, and the Manatee County Clerk says it starts with a petition to be appointed personal representative. Whether you need it, and who can act for the estate with the lender, depends on the situation, so a Florida probate attorney is the right person to ask.
Sources
- CFPB: With a reverse mortgage loan, can my heirs keep or sell my home after I die? (reviewed August 2026)
- CFPB: What happens to my reverse mortgage when I die? (reviewed January 2025)
- CFPB: What happens if I have a reverse mortgage and I have to move out of my home? (reviewed September 2024)
- HUD: Inheriting a Home Secured by an FHA-insured HECM (September 2019)
- HUD Mortgagee Letter 2022-15: Requirements for Notice of Due and Payable Status (August 2022)
- Manatee County Clerk of the Circuit Court: Probate and Guardianship
- Florida Law Help: Reverse Mortgages (HECM)
If a mortgage payment is also behind, my free pre-foreclosure guide for Manatee County homeowners walks through the options.
If you’d like help with this, call or text me at 941-737-6562 or reach out through reynoldsrealty.com.
Linda Reynolds | Reynolds Realty Gulf Coast
Real Estate Solutions for Life’s Complicated Moves.