Detailed answer — how this usually works in California

This section explains the typical steps, the documents lenders commonly request, and practical options you can use to sell a house subject to a reverse mortgage in California.

1) What happens to a reverse mortgage when the borrower dies?

Most reverse mortgages used by older homeowners in the U.S. are Home Equity Conversion Mortgages (HECMs), which are FHA-insured. After the borrower dies, the loan becomes due and payable. The lender (loan servicer) will contact the heirs or personal representative and outline options: repay the loan and keep the home, refinance, or sell the property and use the sale proceeds to pay off the loan. Federal and consumer resources explain the process in plain terms: see HUD’s HECM page (https://www.hud.gov/program_offices/housing/sfh/hecm/hecmhome) and the Consumer Financial Protection Bureau’s reverse mortgage page (https://www.consumerfinance.gov/owning-a-home/reverse-mortgages/).

2) Why is the lender asking for renunciation letters?

When a borrower dies, title to the home may be unclear to the lender. The servicer wants to know who can legally sell the property and who might claim a continuing right to occupy it. A “renunciation” letter typically asks a person who might have a claim (for example, a joint heir, named beneficiary, or alleged successor) to confirm they are not asserting authority to act or do not claim the property. Lenders request these to avoid multiple people claiming control during escrow and to be sure the payoff and sale will clear title.

3) Before agreeing to anything: establish how title passed

• If the property passed by a valid Transfer-on-Death deed or is owned by a living trust, the successor named in that instrument usually has authority to sell without probate.
• If title is joint tenancy with right of survivorship, the surviving joint tenant generally owns the property immediately and can sell.
• If title was solely in your father’s name (and there is no TOD deed or trust), the estate may need to go through probate unless a small-estate process applies.

California’s Probate Code lays out how administration of a decedent’s estate works; see Division 6, Administration of Decedent’s Estate: https://leginfo.legislature.ca.gov/faces/codes_displayexpandedbranch.xhtml?tocCode=PROB&division=6

4) Documents the lender will commonly accept instead of a renunciation

Rather than a private renunciation, lenders often accept one of the following as proof of authority:

• Letters testamentary or letters of administration issued by a California probate court (these confirm who is the court-appointed executor or administrator).
• A valid TOD deed or a copy of the trust and the document showing the successor trustee if the house was in a trust.
• A small estate affidavit or other informal transfer permitted under California law when the estate qualifies. (California’s statutes describe small estate procedures and other probate rules; see the Probate Code at the link above.)
• A certified copy of a final probate order transferring title.

These court or statutory documents are more reliable for a lender than a privately signed renunciation because they reduce the lender’s risk of later competing claims.

5) Practical step-by-step plan to sell the house

1. Obtain the death certificate and a copy of the recorded deed showing current ownership.
2. Contact the reverse mortgage servicer in writing and ask for a written list of required documents and a payoff statement (payoff figure and expiration date).
3. Determine whether the house passes outside probate (TOD deed, living trust, joint tenancy). If so, provide the servicer those documents. If not, consult whether the estate qualifies for a small-estate affidavit or whether probate (formal or limited) is required.
4. If probate is required, talk to a probate attorney about whether you should petition to be appointed executor/administrator so you can sign the sale documents. The court-issued letters give the lender comfort to accept payoff and release lien.
5. List the property with a real estate agent experienced with reverse mortgage estates and escrow. Provide the lender’s payoff and the appointed representative’s documentation to escrow so the payoff can occur at closing.
6. Avoid signing broad renunciation letters that release claims without knowing the consequence. If the servicer says renunciations are mandatory, ask whether a court document (letters) or an affidavit will substitute, and get an attorney opinion before signing anything that eliminates potential rights to proceeds or occupancy.

6) If the lender insists on renunciations

Do not sign any renunciation that absolves the lender from taking necessary steps to clear title in exchange for the sale proceeds without getting advice. Options include:

• Provide the lender with court-issued documentation (letters testamentary/administration) instead of signing a renunciation.
• Provide a recorded instrument (TOD deed, deed transferring title under valid trust) if applicable.
• Ask the servicer in writing to explain exactly why a renunciation is required and whether a court order or affidavit would suffice.
• If multiple family members claim authority, consider a quiet title or interpleader action, or seek a court determination to avoid future disputes.

7) Special notes about reverse mortgages (HECM) and non-recourse

Most FHA-insured HECMs are non-recourse loans: the lender’s recovery is generally limited to the home’s value when sold. That means heirs are not usually personally liable for any shortfall between sale proceeds and the loan balance. For details see HUD’s HECM materials and CFPB guidance: https://www.hud.gov/program_offices/housing/sfh/hecm/hecmhome and https://www.consumerfinance.gov/owning-a-home/reverse-mortgages/.

When to get legal help

Get a probate or real estate attorney if any of the following apply:

• Title is solely in your parent’s name and you need to open probate or prepare a small-estate affidavit.
• Multiple heirs disagree about selling or who should administer the estate.
• The servicer demands you sign a renunciation that affects your ownership or distribution rights.
• You need to complete a sale quickly but the lender is uncooperative.

Helpful hints

• Ask the servicer to put in writing exactly what they require and why. A clear written list prevents delays in escrow.
• Keep copies of the death certificate, recorded deed, any trust documents, and all written communications with the lender and escrow.
• Do not sign a renunciation that gives up your right to proceeds, possession, or to be appointed administrator unless a lawyer explains the consequences.
• If the estate is small, ask whether California’s small estate procedures apply before opening full probate. See the California Probate Code overview: https://leginfo.legislature.ca.gov/faces/codes_displayexpandedbranch.xhtml?tocCode=PROB&division=6
• Work with a real estate agent and escrow officer experienced with reverse-mortgages and probate sales — they can help coordinate payoff and title work.
• If a quick sale is needed, confirm the lender’s payoff expiration date and include a contingency in the purchase agreement for lender approval and clear title.

Disclaimer: This article is informational only and is not legal advice. It explains general California procedures and federal consumer resources about reverse mortgages. Laws change and every situation is different. Consult a licensed California attorney about your specific circumstances before signing documents or taking action that affects title, occupancy, or estate rights.