Can you sell a home that has a reverse mortgage explained

Can you sell a home that has a reverse mortgage? This is a question many homeowners ponder, and the answer is indeed yes, though the process involves unique considerations compared to a standard home sale. Understanding the fundamentals of a reverse mortgage, how it differs from conventional loans, and the conditions that necessitate a sale are crucial first steps. This exploration will demystify the journey of selling a home encumbered by a reverse mortgage, offering clarity and guidance for a smoother transaction.

Delving deeper, a reverse mortgage allows homeowners to convert a portion of their home equity into cash, without the obligation of monthly mortgage payments. Unlike traditional loans where you pay the lender, a reverse mortgage pays you, with the loan balance growing over time. This loan typically becomes due and payable when the last borrower permanently leaves the home, sells the property, or passes away.

Consequently, selling the home often becomes a primary scenario for settling the reverse mortgage obligation.

Understanding Reverse Mortgages and Home Sales

A reverse mortgage is a unique financial tool designed to help homeowners, typically seniors, access the equity built up in their homes without having to sell the property or make monthly mortgage payments. Unlike a traditional mortgage where borrowers make payments to the lender, a reverse mortgage allows the lender to make payments to the borrower. This fundamental difference shifts the financial dynamic, providing a source of income or a lump sum from home equity.The primary purpose of a reverse mortgage is to supplement retirement income, cover healthcare expenses, or provide funds for other financial needs.

It is crucial to understand that the loan balance grows over time, as interest and fees are added to the principal. This contrasts sharply with a traditional home loan, where the principal balance decreases with each payment.

Reverse Mortgage Fundamentals

A reverse mortgage fundamentally allows homeowners aged 62 and older to convert a portion of their home equity into cash. The homeowner retains title to the property, and the loan is repaid when the last borrower permanently leaves the home, sells the property, or passes away. The loan proceeds can be received as a lump sum, a line of credit, or regular monthly payments, or a combination thereof.

Reverse Mortgage Versus Traditional Home Loan

The core distinction between a reverse mortgage and a traditional home loan lies in the direction of cash flow and repayment obligations. In a traditional mortgage, the homeowner makes regular principal and interest payments to the lender, gradually reducing the loan balance. Conversely, with a reverse mortgage, the lender disburses funds to the homeowner, and the loan balance, including accrued interest and fees, increases over time.

There are no required monthly mortgage payments from the borrower as long as they continue to occupy the home as their primary residence, pay property taxes and homeowners insurance, and maintain the property.

Conditions for Reverse Mortgage Repayment

A reverse mortgage becomes due and payable under specific circumstances, primarily when the borrower no longer meets the loan’s continuing obligations or when the loan reaches its maturity. These conditions are designed to protect the lender while ensuring the homeowner’s ability to benefit from the equity.The primary conditions under which a reverse mortgage becomes due and payable include:

• The last surviving borrower permanently moves out of the home. This is often defined as being absent for more than 12 consecutive months, such as moving to a nursing home or living with family.
• The borrower fails to meet the continuing obligations of the mortgage. This encompasses failing to pay property taxes, homeowners insurance premiums, or maintain the home in good repair.
• The borrower fails to comply with any other terms of the reverse mortgage agreement.

Scenarios Triggering Home Sale with a Reverse Mortgage

Several typical scenarios necessitate the sale of a home that has a reverse mortgage. These situations often arise when the homeowner’s circumstances change, or when the reverse mortgage loan itself reaches a point where repayment is required.Common scenarios that trigger the need to sell a home with a reverse mortgage include:

• Downsizing or Relocation: A homeowner may decide to sell their current residence to move to a smaller, more manageable home, or to relocate closer to family or for lifestyle reasons. In such cases, the sale proceeds are used to repay the reverse mortgage balance, with any remaining equity available to the homeowner.
• Need for Funds Exceeding Equity: If a homeowner requires funds that exceed the available equity in their home, or if the reverse mortgage loan balance has grown significantly and the homeowner wishes to free up capital, selling the home might be the most viable option.
• Passing of the Last Borrower: Upon the death of the last surviving borrower, the reverse mortgage becomes due and payable. Heirs or the estate typically have several options, including selling the home to repay the loan, refinancing the loan, or paying the loan balance. If the sale proceeds are insufficient to cover the loan balance, the FHA’s “non-recourse” feature on HECMs protects the heirs from owing more than the home’s appraised value.

• Failure to Meet Loan Obligations: As mentioned, failing to pay property taxes, insurance, or maintain the home can lead to foreclosure, which often results in the sale of the property to satisfy the loan.
• Estate Planning and Liquidation: For an estate, selling a property with a reverse mortgage may be necessary to liquidate assets and distribute them to beneficiaries after the loan is repaid.

The Process of Selling a Home with a Reverse Mortgage

Navigating the sale of a home encumbered by a reverse mortgage requires a clear understanding of the process and proactive communication. Unlike a traditional sale, a reverse mortgage introduces specific requirements that must be meticulously followed to ensure a smooth transaction and the satisfaction of all parties involved. This section details the essential steps and considerations for homeowners embarking on this journey.When a homeowner decides to sell a property with an active reverse mortgage, the first and most critical action is to inform the reverse mortgage servicer.

This isn’t merely a courtesy; it’s a procedural necessity dictated by the terms of the reverse mortgage agreement. The servicer plays a pivotal role in facilitating the sale by providing crucial information and coordinating the payoff of the loan.

Initial Steps for Homeowners

Before listing the property or engaging with real estate agents, homeowners must initiate contact with their reverse mortgage servicer. This early engagement sets the stage for a transparent and efficient sale process.The initial steps involve:

• Reviewing the reverse mortgage loan documents to understand the specific terms and conditions related to sale.
• Gathering personal identification and property details to provide to the servicer.
• Contacting the reverse mortgage servicer to formally notify them of the intent to sell the home.

Communication Requirements with the Reverse Mortgage Servicer

Open and consistent communication with the reverse mortgage servicer is paramount throughout the selling process. The servicer is the keeper of all loan-related information and will be instrumental in calculating the exact payoff amount required.Key communication points include:

• Notification of Intent to Sell: As soon as the decision to sell is made, contact the servicer. This allows them to provide the necessary forms and guidance.
• Requesting a Payoff Statement: This is the most crucial document. The payoff statement will detail the outstanding loan balance, including accrued interest, fees, and any servicing charges up to a specific date. It’s vital to ensure this statement is current and accurate.
• Understanding Loan Terms: Clarify any specific clauses in the mortgage agreement that pertain to selling the property, such as timelines or notification periods.
• Inquiring about Non-Recourse Provisions: For most Home Equity Conversion Mortgages (HECMs), the loan is non-recourse. This means the heirs or the borrower will not owe more than the appraised value of the home at the time of sale, even if the loan balance exceeds it. Understanding this provision is reassuring.

Coordinating the Sale with the Servicer

The sale process needs to be coordinated with the servicer to ensure the reverse mortgage is properly paid off at closing. This coordination typically involves the homeowner, their real estate agent, and the closing agent (escrow or title company).A step-by-step procedure for coordinating the sale:

1. Obtain a Payoff Statement: Upon notifying the servicer of the intent to sell, request a formal payoff statement. This document will Artikel the exact amount needed to satisfy the loan obligation.
2. Engage a Real Estate Agent: Once you have a clear understanding of the payoff amount, work with a real estate agent to list and market the property.
3. Provide Servicer Information to the Closing Agent: Furnish the closing agent with the name and contact details of the reverse mortgage servicer, along with the payoff statement.
4. Schedule Closing: The closing date must be coordinated to allow sufficient time for the servicer to receive funds and release the lien.
5. Closing Day: At closing, the proceeds from the sale will be used to pay off the reverse mortgage balance as detailed in the payoff statement. Any remaining equity after the payoff will be distributed to the homeowner or their heirs.

Key Documents and Information from the Reverse Mortgage Servicer

To facilitate a smooth sale and ensure the accurate payoff of the reverse mortgage, several key documents and pieces of information are required from the servicer.The essential items include:

• Payoff Statement: This is the most critical document, detailing the exact amount required to close out the loan. It should include:
  • Principal balance
  • Accrued interest
  • Servicing fees
  • Mortgage insurance premiums (if applicable)
  • Any other outstanding charges

  The statement will also specify a valid date for the payoff amount.

• Loan Identification Number: This number is essential for the closing agent to reference the correct loan account.
• Lien Release Instructions: The servicer will provide instructions on how they will release the lien on the property once the loan is paid off.
• Contact Information for the Servicer’s Payoff Department: This ensures direct communication for any necessary clarifications or urgent matters.

It is crucial to keep copies of all correspondence and documents exchanged with the reverse mortgage servicer for your records.

It is certainly possible to sell a home with a reverse mortgage, and understanding the process is key. While the specifics can vary, one common consideration is how long does a reverse mortgage go through probate, a topic you can explore further at how long does a reverse mortgage go through probate. Rest assured, navigating these steps allows for a smooth sale of a home with a reverse mortgage.

Financial Implications and Payouts

Navigating the financial landscape when selling a home with a reverse mortgage requires a clear understanding of how the proceeds are allocated. Unlike a traditional sale, the outstanding loan balance, including accrued interest and fees, takes precedence. This section demystifies the distribution of sale proceeds, the unique nature of non-recourse loans, and the various outcomes based on the sale price relative to the loan balance.The sale of a home encumbered by a reverse mortgage triggers a specific disbursement process.

The primary objective is to satisfy the outstanding loan obligations first. Any remaining funds after the loan is fully repaid are then distributed according to established protocols, typically to the borrower or their heirs.

Sale Proceeds Distribution

When a home with a reverse mortgage is sold, the sale proceeds are distributed in a defined order of priority to ensure the lender is repaid and any remaining equity is accounted for.The typical distribution hierarchy is as follows:

• First, all outstanding loan balances, including principal, accrued interest, and any applicable servicing fees, are paid to the reverse mortgage lender.
• Second, any closing costs associated with the sale of the property are deducted. This can include real estate agent commissions, title insurance, escrow fees, and other standard selling expenses.
• Third, if there is any remaining equity after the loan and closing costs are settled, this surplus will be paid to the borrower or their estate.

Non-Recourse Loan Feature

A crucial aspect of reverse mortgages, particularly relevant during a sale, is their non-recourse nature. This feature protects the borrower and their heirs from owing more than the home’s value, regardless of how much was borrowed or how long the loan was in place.The non-recourse provision means that the borrower, or their estate, will never be obligated to repay more than the lesser of the appraised value of the home at the time of sale or the total amount owed on the reverse mortgage.

This is a significant protection, especially in declining real estate markets. For instance, if the borrower owes $300,000 on the reverse mortgage, but the home only appraises for $250,000 at the time of sale, the lender absorbs the $50,000 loss. The borrower or their heirs are not required to make up the difference.

Outcomes Based on Sale Price

The financial outcome of selling a home with a reverse mortgage is directly tied to the relationship between the sale price and the outstanding loan balance. Understanding these scenarios provides clarity on potential equity or shortfalls.Here are the potential outcomes:

• Sale Price Exceeds Loan Balance: In this favorable scenario, the sale proceeds are first used to pay off the reverse mortgage in full, including all accrued interest and fees. The remaining equity after deducting selling expenses is then disbursed to the borrower or their heirs. This represents a profitable sale where the borrower has built equity that is now realized.
• Sale Price Equals Loan Balance: When the sale price exactly matches the total amount owed on the reverse mortgage, the entire sale proceeds are used to satisfy the loan. After covering selling expenses, there is no remaining equity to be distributed to the borrower or their heirs. The loan is effectively paid off with the sale of the home.
• Sale Price is Less Than Loan Balance: This is where the non-recourse feature becomes paramount. The sale proceeds are applied to the loan balance. Even if the sale price is insufficient to cover the entire amount owed, the lender cannot pursue the borrower or their estate for the remaining debt. The lender absorbs the loss due to the non-recourse protection. Any remaining proceeds after covering the sale expenses and a portion of the loan balance are disbursed, but the total debt is considered settled by the sale of the property.

Receiving Remaining Equity

If the sale of the home generates proceeds that exceed the total reverse mortgage debt and selling costs, the remaining equity is disbursed to the rightful parties. This process ensures that any value built up in the home beyond the loan obligation is returned.The process for receiving any remaining equity typically involves the closing agent or title company that handles the sale transaction.

Once all obligations to the lender are met and all selling expenses are paid, the closing agent will issue a check or initiate a wire transfer for the net proceeds. This distribution is made to:

• The borrower, if they are alive and were the sole owner or co-owner who sold the home.
• The borrower’s estate, if the borrower has passed away and the sale is being conducted by their executor or administrator.
• The heirs of the borrower, if the estate has been settled and the equity is designated for distribution to them.

Challenges and Considerations for Sellers: Can You Sell A Home That Has A Reverse Mortgage

Navigating the sale of a home with a reverse mortgage, while entirely feasible, presents a unique set of hurdles that sellers and their representatives must be prepared to address. Understanding these potential obstacles is the first step toward a streamlined and successful transaction. These challenges often stem from the specific nature of reverse mortgages and their interplay with the sales process and estate planning.

Common Obstacles for Homeowners

Selling a home encumbered by a reverse mortgage can introduce several common difficulties. The most significant often revolves around the payoff of the loan balance, which can be substantial and may exceed the current market value of the home, particularly in declining real estate markets. This situation, known as being “underwater” on the mortgage, requires careful financial planning and clear communication with the lender.

Another hurdle is the potential for delays if the necessary documentation from the lender is not readily available or if there are complexities in the loan servicing. The heirs of the homeowner also play a crucial role, and their understanding and cooperation are vital, especially if the homeowner has passed away and the sale is being managed by their estate.

Complications for Heirs and Beneficiaries

When a homeowner with a reverse mortgage passes away, their heirs or beneficiaries inherit the responsibility of managing the property and the reverse mortgage. A primary complication arises if the loan balance, including accrued interest and fees, is greater than the home’s appraised value. In such cases, the heirs are generally not personally liable for the difference due to the non-recourse nature of most reverse mortgages.

However, they must still formally notify the lender within a specified timeframe (typically 60 days) and decide whether to sell the home, pay off the loan balance, or deed the property back to the lender. Failure to do so can lead to foreclosure proceedings. Another consideration is the emotional aspect; heirs may be grieving and simultaneously tasked with complex financial decisions.

Timeline Considerations for Sale Completion

The timeline for selling a home with a reverse mortgage can be influenced by several factors. The initial notification to the lender upon the homeowner’s death or permanent move-out is a critical first step, triggering a period during which heirs can decide on the property’s future. This period is often around 6 to 12 months, but it’s essential to confirm the exact terms with the lender.

The process of obtaining a clear payoff statement from the lender can take time, and this document is essential for any potential buyer. Furthermore, the marketing and sale of the property itself are subject to standard real estate market conditions. If the home requires repairs or staging to attract buyers, this will add to the overall timeline. Buyers may also be hesitant if they are unfamiliar with reverse mortgages, leading to longer negotiation periods.

Navigating the Process for a Smooth Transaction

To ensure a smooth transaction when selling a home with a reverse mortgage, proactive communication and thorough preparation are key. Engaging a real estate agent experienced with reverse mortgage sales is highly recommended. They can help set realistic expectations regarding pricing, marketing strategies, and the unique aspects of the transaction. Obtaining a detailed payoff statement from the reverse mortgage lender as early as possible is crucial.

This statement will Artikel the exact amount due to the lender, including any accrued interest, servicing fees, and potential mortgage insurance premiums. It is also advisable for heirs to consult with an attorney or financial advisor to fully understand their options and responsibilities. Clear and consistent communication with all parties involved – the lender, the heirs, and potential buyers – will help mitigate misunderstandings and expedite the closing process.

Roles of Professionals in the Sale

Navigating the sale of a home with a reverse mortgage involves a specialized team of professionals. Each plays a crucial role in ensuring a smooth, compliant, and financially sound transaction for the homeowner. Their expertise is not merely beneficial; it’s often essential for overcoming the unique complexities associated with these sales.Understanding the distinct contributions of each professional can empower sellers to make informed decisions and select the right support for their situation.

This collaborative effort ensures that all legal, financial, and logistical aspects are meticulously managed.

Real Estate Agent Experience with Reverse Mortgages

A real estate agent with specific experience in reverse mortgage sales is an invaluable asset. These agents understand the nuances of marketing a property encumbered by a reverse mortgage, including potential buyer education and the specific documentation required. They can accurately price the home, considering any remaining loan balance and potential equity.This specialized knowledge allows them to:

• Effectively communicate the benefits and process to potential buyers, dispelling common misconceptions about reverse mortgages.
• Navigate the unique appraisal process that may be required for homes with reverse mortgages.
• Coordinate with the reverse mortgage servicer and other parties to ensure timely access to the property for showings and inspections.
• Manage the marketing strategy to attract buyers who are either familiar with or open to purchasing a home with an existing reverse mortgage.

Role of the Reverse Mortgage Servicer

The reverse mortgage servicer is a central figure throughout the selling process. They manage the existing reverse mortgage and are responsible for providing the payoff amount needed to clear the title upon sale. Their involvement is critical for transparency and accuracy in the financial aspects of the transaction.Key responsibilities of the servicer include:

• Providing the official payoff statement, which details the outstanding loan balance, accrued interest, fees, and any other charges. This statement is time-sensitive and crucial for closing.
• Working with the closing agent to ensure all lienholders are satisfied and the title can be transferred free and clear.
• Communicating any specific requirements or timelines related to the reverse mortgage that might impact the sale.
• Facilitating the release of the lien once the loan is paid off.

Attorney or Closing Agent Facilitation

An attorney or a dedicated closing agent acts as the neutral third party, orchestrating the final stages of the sale. They ensure that all legal documentation is correctly prepared and executed, that funds are properly disbursed, and that the title transfer is legally sound. Their role is to protect the interests of all parties involved.Their critical functions encompass:

• Reviewing and preparing all necessary closing documents, including the deed, title insurance policies, and settlement statements.
• Coordinating the signing of all documents by the buyer and seller.
• Receiving and disbursing all funds, including the proceeds from the sale and the payoff to the reverse mortgage servicer.
• Ensuring that all conditions of the sale contract have been met.
• Recording the deed and other relevant documents with the appropriate government authorities.

Potential Need for a Financial Advisor

While not always mandatory, a financial advisor can provide invaluable guidance to homeowners, particularly those who may be unfamiliar with managing significant financial transactions or who have complex financial situations. They can help the homeowner understand the net proceeds from the sale and how these funds can be best utilized.A financial advisor can assist by:

• Explaining the tax implications of the sale and any remaining equity.
• Helping the homeowner plan for their future financial needs, especially if the reverse mortgage funds were a primary source of income.
• Providing advice on reinvesting or managing the proceeds from the sale.
• Offering a comprehensive overview of the homeowner’s overall financial health in light of the sale.

Marketing and Presenting the Home

Selling a home with a reverse mortgage requires a nuanced approach to marketing and presentation. The goal is to showcase the property’s inherent value while proactively addressing any potential buyer apprehension stemming from the existing mortgage. This involves strategic framing of the property’s benefits and a clear, transparent communication strategy.The unique nature of a reverse mortgage sale means that marketing efforts should focus on highlighting the property’s appeal and the advantages of the transaction, rather than dwelling on the mortgage itself.

This section Artikels effective strategies to achieve this, ensuring the home is presented in its best light to attract the right buyers.

Marketing Strategies for Homes with Reverse Mortgages

When marketing a home secured by a reverse mortgage, the focus shifts from traditional selling points to emphasizing the ease and benefits of the transaction for the buyer. The strategy should be to normalize the situation and highlight the positive aspects of acquiring a property that may have a pre-existing financial arrangement. This involves leveraging specific marketing channels and messaging.

• Targeted Online Advertising: Utilize platforms that allow for detailed demographic and interest-based targeting. Focus on buyers who may be more amenable to unique purchase scenarios, such as investors or those seeking a straightforward acquisition process.
• Highlighting Property Features: The primary marketing thrust should be on the home’s inherent strengths: location, condition, amenities, and potential for appreciation. Emphasize the lifestyle or investment benefits the property offers.
• Educational Content for Agents: Ensure real estate agents involved are well-versed in the specifics of reverse mortgage sales. Providing them with clear, concise information empowers them to confidently represent the property and answer buyer questions.
• Open Houses with a Clear Narrative: Structure open houses to provide a positive and informative experience. Have marketing materials available that briefly explain the sale process without overemphasizing the reverse mortgage itself.

Organizing Content to Highlight Unique Aspects, Can you sell a home that has a reverse mortgage

The way information is presented is crucial. Content should be organized to proactively address potential concerns and highlight the benefits of purchasing a home with a reverse mortgage. This involves a structured approach to all property-related documentation and communication.

• Dedicated Information Packet: Prepare a comprehensive packet for interested buyers and their agents. This packet should include standard property disclosures, but also a clear, simple explanation of the reverse mortgage and how it affects the sale process, focusing on the buyer’s perspective.
• Website or Landing Page: For larger or more unique properties, consider a dedicated website or landing page. This allows for a more in-depth presentation of the home and the sale process, with sections dedicated to FAQs about reverse mortgage sales.
• Visual Storytelling: Employ high-quality photography and videography that showcases the property’s best features. A virtual tour can be particularly effective in allowing buyers to explore the home remotely, building interest before an in-person visit.

Descriptive Narratives for Property Listings

Crafting compelling listing descriptions is paramount. These narratives need to be both attractive and informative, subtly addressing the reverse mortgage aspect by focusing on the positive implications for the buyer. The language should be reassuring and highlight the streamlined nature of the potential transaction.

“Discover a charming residence offering [mention key features like ‘spacious living areas,’ ‘modern kitchen,’ or ‘tranquil backyard’] in a sought-after neighborhood. This property presents a unique opportunity for discerning buyers seeking [mention buyer benefits like ‘immediate occupancy,’ ‘investment potential,’ or ‘a peaceful retreat’]. The sale process is designed for clarity and efficiency, ensuring a smooth transition for the new owner.”

Presenting the Home to Emphasize Appeal

The physical presentation of the home is as important as its digital or written representation. The goal is to create an inviting atmosphere that distracts from any perceived complexities of the sale and instead draws attention to the property’s livability and potential.

• Staging for Maximum Impact: Professionally stage the home to highlight its best features and create a warm, welcoming ambiance. Neutral decor and thoughtful arrangement of furniture can make rooms appear larger and more appealing.
• Focus on Lifestyle: Present the home as a place where buyers can immediately envision themselves living. This means showcasing the outdoor living spaces, the proximity to local amenities, and the overall quality of life the neighborhood offers.
• Transparency in Showings: While the reverse mortgage should not be the focus, be prepared to answer questions about it honestly and directly if they arise during showings. Have printed materials available that explain the buyer’s role and responsibilities clearly.
• Highlighting the “Move-In Ready” Aspect: Often, homes with reverse mortgages are well-maintained. Emphasize any aspects that make the home move-in ready, as this is a significant selling point for many buyers.

Epilogue

Navigating the sale of a home with a reverse mortgage, while presenting distinct challenges, is certainly achievable with proper planning and execution. By understanding the intricacies of the process, from initial communication with the servicer to managing financial implications and coordinating with experienced professionals, homeowners can effectively transition out of their reverse mortgage. The key lies in proactive engagement, clear documentation, and a strategic approach to marketing and legal requirements, ensuring a successful and equitable outcome for all parties involved.

User Queries

What is the primary purpose of a reverse mortgage?

The primary purpose of a reverse mortgage is to allow homeowners, typically seniors, to convert a portion of their home equity into tax-free cash without having to sell their home or make monthly mortgage payments.

How does a reverse mortgage differ from a traditional home loan?

In a traditional loan, you make monthly payments to the lender. With a reverse mortgage, the lender makes payments to you, and the loan balance increases over time, with repayment typically deferred until the borrower moves out, sells the home, or passes away.

When does a reverse mortgage become due and payable?

A reverse mortgage generally becomes due and payable when the last surviving borrower permanently moves out of the home, sells the home, or passes away. It can also become due if the borrower fails to meet loan obligations, such as paying property taxes or maintaining the home.

What are the initial steps for selling a home with a reverse mortgage?

The initial steps involve contacting the reverse mortgage servicer to inform them of your intention to sell and to obtain a payoff statement detailing the exact amount owed. It’s also advisable to consult with a real estate agent experienced in reverse mortgage sales.

What is a non-recourse loan in the context of reverse mortgages?

A non-recourse loan means that the borrower or their heirs will never owe more than the value of the home at the time of sale, even if the loan balance exceeds the sale price. The FHA insurance on most reverse mortgages covers any shortfall.

What happens if the sale price is less than the reverse mortgage balance?

If the sale price is less than the reverse mortgage balance, the FHA insurance on the loan typically covers the difference. The heirs or the estate would not be responsible for the remaining debt.

Who typically handles the closing of a home sale with a reverse mortgage?

A title company or an attorney specializing in real estate transactions usually handles the closing process. They coordinate with the reverse mortgage servicer to ensure all liens are satisfied and title is transferred cleanly.