After reading the note, it was written in such a way that it was in in immediate default as soon as the person dies. We had 30 days to settle the note after getting the notice of default.

Since the note was relatively small compared to the price of the house, we wanted to simply pay it off so we could sell the house after fixing it up, but this outfit even made this quite difficult. Fortunately, we got the note paid off within a few days of the actual foreclosure process starting (after that, we would have owed a couple tens of thousands in legal fees as well as the note balance).

From their docs, it was clear that they simply wanted us to hand them the deed, or have them sell the house for us (doubtless for hundreds of thousands less than market value – the house is in Silicon Valley, not far from the new Apple HQ). They made it quite difficult to actually get pay-off wire instructions and it took two weeks to get it done.

Reverse mortgages strike me as having severe “agency issues”: the people who have to settle the mortgage are not the people who got it (even the collection agency’s customer service is top-notch to the people who got the mortgage).

Sigh. Should I just let all these go? I don’t know. Things are different because they are different things. Whole life annuities are worse than other kinds of annuities. Reverse mortgages are probably worse than regular mortgages. Banks can do good things and bad things. It’s not their job to decide which profitable things are good and which are evil, that’s our job.