If you’re dealing with a parent’s house that has a reverse mortgage, the first thing that usually happens is the servicer sends a notice after the parent passes away. That notice is basically the servicer telling you the loan is due and asking the heirs to get in touch. Don’t ignore it. Open it, read it, and call the number on it to confirm they know the estate is being handled. The notice often asks for a copy of the death certificate and sometimes paperwork showing who has authority over the estate, like being the executor or trustee. What exactly they need depends on how the title and the estate are set up, so if it’s not clear, that’s a good moment to talk to a lawyer.

The due and payable process sounds scarier than it usually is. The loan becomes due because the last borrower died or moved out permanently, but that doesn’t mean someone shows up tomorrow with a moving truck. In general terms, the servicer starts a clock and the heirs have a window to decide what to do. That window and the options depend on the situation, and the rules around reverse mortgages are specific, so this is where a HUD-approved housing counselor can be genuinely useful and free to talk to. They can walk you through what the servicer is required to offer and what your choices look like. A CPA helps too if you’re sorting out tax consequences of selling or inheriting.

Then you get to the practical fork in the road. You can buy the house, meaning someone pays off the loan, usually at a percentage of the appraised value rather than the full balance if the loan is underwater. You can sell it, which often is the cleanest path, and the loan gets paid off from the proceeds. Or you can hand it back to the lender, sometimes called a deed in lieu, and walk away without owing more than the house is worth. Which one makes sense depends on the equity, whether anyone wants to live there, and what the estate can afford. Nobody can tell you the right answer without looking at the numbers.

Keep in mind that Sacramento County probate or a trust administration may run alongside all this, and the two timelines don’t always match up. If the house is in a trust, the successor trustee handles it. If it’s going through probate, the court process matters. Stay in contact with the servicer in writing, keep copies of everything, and don’t sign anything you don’t understand. When in doubt, get a lawyer involved early rather than late.

There is a fuller write-up at when a parent had a reverse mortgage.