Selling a Home with a Reverse Mortgage in Hawaii: What to Do When the Lender Requests Renunciation Letters | Hawaii Probate | FastCounsel
Get Matched
HI Hawaii Probate

Selling a Home with a Reverse Mortgage in Hawaii: What to Do When the Lender Requests Renunciation Letters

August 15, 2025 6 min read

How to sell a home in Hawaii when the reverse mortgage lender asks for renunciation letters

Disclaimer: This article is educational only and not legal advice. For advice about a specific situation, contact a licensed Hawaii attorney who handles probate, real estate, or reverse mortgage matters.

Detailed answer — steps and legal tools under Hawaii law

If you must sell a property encumbered by a reverse mortgage, the lender’s request for “renunciation” or similar signed statements is common. Lenders often ask people with potential claims on the house to say they will not assert occupancy or ownership rights so the lender can process a payoff and allow sale. In Hawaii the practical path forward depends on who owns title, whether the borrower is alive, and whether an estate administration or small‑estate procedure is needed.

1. Confirm ownership and the loan status

  • Get a certified copy of the death certificate if the borrower is deceased.
  • Order a title report or run a land records check to confirm the record owner(s) and any other recorded interests (deeds, liens, spouse’s interest, beneficiary designations, or transfer‑on‑death instruments).
  • Ask the lender in writing for a payoff statement and a clear list of documents they need to release the lien after sale.

2. Understand what a renunciation letter likely means

In this context a renunciation letter typically asks a potential heir, occupant, or relative to formally give up any claim to remain in the property or to claim an ownership interest that would block a sale. That request may be legitimate if the person named has no legal ownership but might be a way for the lender to reduce the risk of occupancy disputes after the sale.

3. Determine whether probate or another transfer mechanism applies

In Hawaii, real estate passes according to how title is held or via estate administration when title is solely in the deceased borrower’s name. If title passed outside probate (joint tenants, beneficiary deed, or other transfer device), the new owner can normally sell and repay the reverse mortgage. If title is in the deceased borrower alone, the personal representative (executor) must usually be appointed or a small‑estate procedure used to clear title for sale.

For general legislative text and the probate code, see the Hawaii Revised Statutes compilation: https://www.capitol.hawaii.gov/hrscurrent/. For local court forms and probate procedures, see the Hawaii State Judiciary: https://www.courts.state.hi.us/.

4. If the lender insists on renunciations, proceed carefully

  • Do not sign or have heirs sign broad renunciation forms without legal review. A blanket renunciation could unintentionally give up rights people should keep (for example, survivorship or spousal rights).
  • If an heir or occupant refuses to sign, the person handling the estate can ask the probate court for authority to sell the property free and clear of competing claims.
  • If a non‑borrowing spouse or surviving co‑owner exists, federal HECM rules and some state protections can affect rights to remain in the home. Check lender policy and federal guidance from HUD on HECMs: https://www.hud.gov/program_offices/housing/sfh/hecm.

5. Typical legal paths to clear title and complete a sale in Hawaii

  1. Obtain personal representative authority through probate and then sell the property using the probate court’s authority. Courts can order sales that clear or prioritize claims.
  2. Use Hawaii’s small‑estate or simplified procedures if the estate qualifies; those can transfer title without full probate in limited situations.
  3. If title passed by beneficiary designation or joint tenancy, obtain recorded proof of transfer and then sell.
  4. Request a conditional payoff from the lender stating exactly what documents (including any acceptable renunciations or affidavits) the lender will accept to release liens at closing. Get that in writing.
  5. If the lender’s demand is unreasonable or inconsistent with recorded title, a quiet‑title or declaratory relief action in state court can resolve who has the right to sell or occupy the property.

6. Negotiation strategies with the lender

  • Ask the lender to accept a narrowly tailored affidavit from the personal representative stating family members waive occupancy claims after closing rather than an individual renunciation that might affect inheritance rights.
  • Request written exceptions for occupants who will be moved out at closing or for conditional payoffs that allow escrow to disburse funds to pay the loan and clear title.
  • If the matter is time‑sensitive, ask the lender for a temporary agreement that allows listing and closing while dispute resolution proceeds.

7. When to involve a Hawaii attorney

Get a local probate or real estate attorney experienced with reverse mortgages if:

  • Heirs refuse to sign documents the lender seeks.
  • Title is unclear or there are competing recorded interests.
  • The lender demands documents that appear to waive legal rights or affect the estate beyond resolving the lien.
  • You need a court order to sell or clear title quickly.

Helpful hints

  • Collect the borrower’s loan number, original note, and the death certificate before calling the lender.
  • Get a current payoff figure in writing and a list of exact documents the lender requires at closing.
  • Order a title report early to identify unrecorded issues quickly.
  • Do not sign broad renunciations or disclaimers without independent legal review — narrow, purpose‑specific affidavits are safer.
  • Contact a HUD‑approved housing counselor for reverse mortgage basics: HUD HECM info.
  • If time is short, ask the lender for a written conditional payoff that lists acceptable closing documents.
  • If you can, sell the property and pay the reverse mortgage from sale proceeds; lenders generally accept sale payoffs that satisfy the loan balance.
  • If someone remains in the house and will not leave, the lender may refuse a sale until occupancy is resolved — a court order can resolve that standoff.

Key resources

If the lender’s insistence on renunciation letters is blocking a sale, the usual and effective remedies in Hawaii are (1) get narrow, transaction‑specific affidavits acceptable to the lender; (2) secure authority to sell through probate or small‑estate procedures; or (3) ask a court to resolve competing claims. An experienced local attorney can prepare the narrow documents the lender will accept, petition the probate court to authorize a sale, or bring a quiet‑title action if necessary.

Remember: this is general information, not legal advice. Consult a Hawaii lawyer before signing any renunciation, affidavit, or court document.

The information on this site is for general informational purposes only, may be outdated, and is not legal advice; do not rely on it without consulting your own attorney.