Coastal San Diego · Seller guides · Estates
Selling a home with a reverse mortgage in San Diego
Short answer: A reverse mortgage is a home loan that is paid back later, often when the home is sold. When the loan comes due, the people handling the home can pay it off, sell the home to repay it, or hand the home to the lender. Ask the loan servicer for the exact payoff (the amount that clears the loan) first.
I help heirs and owners in La Jolla and around coastal San Diego sell homes that still carry a loan, including reverse mortgages. Clear steps make a hard time easier.
This guide quotes the federal consumer agency, the CFPB (Consumer Financial Protection Bureau). It isn’t legal or tax advice.
I’m Weston Clark, Founding Member of the Dickinson-Clark Team at Compass. I help sellers and heirs in coastal San Diego plan a sale when a loan is still on the home. You can talk about fees with Weston directly. This form does not give a commission quote.
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Related: Inherited homes · Selling a home held in a trust · Court-supervised sales · What would I take home? · Guides · Selling a duplex
When the loan comes due
The CFPB says:
“A reverse mortgage loan becomes due and payable after your death and after the death of any coborrowers or of an eligible nonborrowing spouse.”
It also says: “Reverse mortgage loans typically must be repaid, usually by selling the home, when the last borrower dies.” A loan can also come due if the borrower moves out for good. The loan papers spell out the exact terms.
What heirs can do
The CFPB says:
“Your heirs might not have the money pay off the loan balance when it is due and payable, so they might need to sell the home to repay the reverse mortgage loan.”
If the home is worth more than the loan, the CFPB adds: “This means your heirs can sell the home, use the money to repay the loan, and keep the difference.”
If the home is worth less than the loan, the CFPB explains that heirs may still sell it to pay off the loan, and mortgage insurance covers the rest. The lender sets short deadlines, so call the servicer early.
Steps to sell
- Find the loan papers and the servicer’s contact.
- Ask for a written payoff and the deadline.
- Find out who has authority to sell. That may be a person named in a trust, or someone the court appoints.
- Get a value estimate and a sale plan that fits the deadline.
- Keep the home insured and cared for until it sells.
Trusts, wills and court
Who can sign for the sale depends on how the home was held. See my guide to selling a home held in a trust, my inherited home guide and my guide to court-supervised sales.
If you are the borrower and want to sell
You can sell a home with a reverse mortgage, like a home with any other loan. The loan is paid from the sale. Ask your servicer for a payoff statement before you list. My take-home estimate tool helps you see what you might take home.
General information only
This guide explains the process. It isn’t legal, tax or lending advice. A HUD-approved housing counselor or an attorney can help with your own loan.
More on sandiego.homes
- Inherited homes: selling a home you received
- Trust sales: selling a home held in a trust
- Probate: court-supervised sales
- Take-home estimate: what you might take home
More: All guides · La Jolla · Real estate terms
FAQ
When does a reverse mortgage have to be repaid?
The CFPB says the loan becomes due and payable after the death of the borrower, any coborrowers and any eligible nonborrowing spouse. It can also come due if the borrower moves out for good.
Can heirs sell a San Diego home that has a reverse mortgage?
Yes. The CFPB says heirs might need to sell the home to repay the loan. If the home is worth more, they keep the difference.
What if the home is worth less than the reverse mortgage?
The CFPB explains heirs may still sell to pay off the loan, and mortgage insurance covers the rest. Ask the servicer about the rules for your loan.
What is the first step to sell a home with a reverse mortgage?
Ask the loan servicer for a written payoff, the amount that clears the loan, and the deadline.
Can I sell my own home if it has a reverse mortgage?
Yes. The loan is paid from the sale, like any other home loan. Ask your servicer for a payoff statement before you list.
Is this reverse mortgage guide legal advice?
No. It's general information about the process. It's not legal, tax or lending advice.
Talk with Weston about the sale
Tell me about the home and the loan. I’ll help you plan the sale around the deadlines.
Or call (858) 997-8998 · weston@sandiego.homes · Search on Compass
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Weston Clark · Founding Member of the Dickinson-Clark Team at Compass · (858) 997-8998 · weston@sandiego.homes
Weston Clark, DRE #02122466 · Compass, DRE #01527365
Compass is a real estate broker licensed by the State of California and abides by Equal Housing Opportunity laws. All material presented herein is intended for informational purposes only, compiled from sources deemed reliable but not verified. Changes in price, condition, sale or withdrawal may be made without notice. All measurements and square footage are approximate.
⌂ Equal Housing Opportunity. This page is general information about places and process — not legal, tax, title, insurance, lending, or financial advice. Loan terms differ. Confirm with your servicer, a HUD-approved counselor or an attorney. Brokerage compensation is discussed directly with Weston for the specific transaction.