The direct answer: When a reverse mortgage borrower dies, the loan becomes "due and payable" immediately, and heirs typically have 30 days after receiving formal notice from the lender to tell the servicer whether they plan to pay it off, sell the home, or walk away — with extensions available up to six months total to actually complete a sale. Miss that window without communicating with the lender, and foreclosure can begin even though the loan itself was never in default during the borrower's lifetime. If you've just inherited a Texas home with a reverse mortgage attached, the clock is running from the day the lender is notified, not from the day probate concludes.
By Zareena Samidon | Samidon Realty Group | Colleyville, TX | 8 years buying DFW homes for cash | (817) 880-0904
Last updated: August 12, 2026
What "Due and Payable" Actually Means
A reverse mortgage, most commonly a federally insured Home Equity Conversion Mortgage (HECM), lets a homeowner age 62 or older borrow against their home equity with no monthly payments required during their lifetime. The loan doesn't disappear — it becomes due in full when the borrower dies, permanently moves out, or sells.
Due and payable is the formal status the loan enters the moment that triggering event happens. For heirs, the death of the borrower is almost always the trigger. Critically, the loan is non-recourse: neither the estate nor the heirs personally owe more than the home is worth, even if the loan balance has grown larger than the property's value over the years the borrower held it. But that protection only helps if the heirs act within the lender's timeline — it doesn't extend the timeline itself.
The Heir's Timeline, Step by Step
| Step | Typical Timing |
|---|---|
| Borrower passes away | Day 0 |
| Heirs notify the loan servicer of the death | As soon as possible — delay here shortens everything downstream |
| Servicer sends the formal due-and-payable notice | Generally within 30 days of learning of the death |
| Initial response window for heirs | 30 days from the due-and-payable notice to state intent: pay off, sell, or deed the home to the lender |
| First extension (if heirs are actively pursuing a sale or financing) | Up to 90 additional days, generally granted in 3-month increments |
| Maximum total extension window | Up to 6 months from the due-and-payable notice in most cases, occasionally longer with documented hardship |
| If no response or action | Lender can initiate foreclosure to satisfy the debt |
The most common mistake isn't failure to act — it's failure to communicate. Heirs who are actively working a sale but never formally notify the servicer of their plan can find the foreclosure clock running in the background regardless of the progress they're actually making.
Two Payoff Scenarios Heirs Face
Scenario A — The home is worth more than the loan balance. The heirs sell the home, the sale proceeds pay off the reverse mortgage balance in full at closing, and whatever remains belongs to the estate or heirs per the will or Texas intestacy rules. This is the straightforward case and requires no special negotiation with the lender beyond standard payoff coordination.
Scenario B — The loan balance exceeds the home's value. Because HECM loans are non-recourse and FHA-insured, heirs can satisfy the debt by selling the home for at least 95% of its current appraised value, even if that amount is less than the full loan balance. The FHA mortgage insurance the borrower paid during the loan's life covers the shortfall to the lender. Heirs never have to pay the difference out of pocket in this scenario.
Where Probate Complicates the Timeline
This is the piece most reverse mortgage guides miss, because most of them are written for heirs who inherit outright, not for heirs navigating Texas probate at the same time.
If the deceased borrower's estate must go through probate — which is common when there's no living trust or Transfer on Death Deed in place — the executor typically needs court authority before they can legally sell the property. Texas probate commonly takes 4–9 months from opening the estate to receiving that authority.
The problem: the reverse mortgage servicer's due-and-payable clock doesn't wait for probate to finish. An executor can be fully cooperative, moving as fast as the Texas probate courts allow, and still run past the lender's 6-month maximum extension window before they're legally able to close a sale.
What experienced heirs and executors do:
- Notify the reverse mortgage servicer of the death immediately, even before probate is opened, to start the formal clock and preserve the extension options
- Request extensions in writing at each interval, documenting that a sale is actively in progress
- Work with a title company and buyer experienced in probate-timeline closings, so the sale can execute the moment court authority is granted rather than adding additional weeks afterward
- If the estate is small enough to qualify, explore Texas's simplified probate procedures (Small Estate Affidavit or Muniment of Title) to shorten the court timeline where eligible
A Realistic DFW Scenario
Composite scenario based on the pattern we see across DFW probate closings: An heir inherits a Colleyville-area home with a reverse mortgage balance of roughly $180,000 against a home worth approximately $310,000. The borrower passed away, and it took the family six weeks to locate the loan documents and formally notify the servicer — time that came directly out of the 30-day initial response window.
Probate had to be opened because there was no trust in place, and the attorney-estimated timeline to receive court authority to sell was 5–6 months. Combined with the servicer's maximum 6-month extension window from the due-and-payable notice, the family had almost no cushion between "probate authority granted" and "lender's patience exhausted."
The deal that worked: the family engaged a cash buyer early, before court authority was even granted, so a purchase agreement was fully negotiated and ready to execute the moment the court issued Letters Testamentary. The closing happened within days of receiving that authority rather than weeks, preserving the extension window the servicer had granted and avoiding any foreclosure risk. This is the same urgency dynamic behind several of the probate closings we've handled, including one where an executor's attorney letter was the single document standing between a stalled estate and a completed sale.
Why Speed Matters More Here Than in a Typical Inherited-House Sale
A standard inherited-property sale has a soft deadline — heirs sell when they're ready. A reverse mortgage adds a hard deadline set by a third-party lender who has no obligation to be flexible beyond the standard extension framework. That changes the priority order for heirs:
- Notify the servicer first, before anything else, even before deciding what to do with the house long-term
- Line up a buyer who can move on the court's schedule, not the buyer's own financing timeline — this is where traditional mortgage-financed buyers create the most risk, since their lender's underwriting timeline adds weeks the estate may not have
- Keep the servicer informed in writing at every extension interval, creating a paper trail that protects the estate if the timeline runs long through no fault of the heirs
A cash buyer removes the biggest variable in this equation: financing-related delay. When the estate finally receives court authority to sell, a cash closing can happen in days rather than the 30–45 days a financed buyer's underwriting typically requires — often the difference between closing inside the servicer's extension window and missing it.
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Frequently Asked Questions About Reverse Mortgages and Inherited Texas Homes
Do heirs personally owe money if the reverse mortgage balance is higher than the home's value? No. HECM reverse mortgages are non-recourse loans backed by FHA insurance. Heirs can satisfy the full debt by selling the home for at least 95% of its current appraised value, and the FHA insurance covers any remaining gap to the lender — heirs are never personally liable for the shortfall.
What if the heirs want to keep the house instead of selling it? Heirs can pay off the reverse mortgage balance using other funds or refinance into a traditional mortgage in their own name. If the loan balance exceeds the home's value, heirs can typically purchase the home from the estate for 95% of the appraised value rather than the full loan balance, then refinance that amount separately.
Does the reverse mortgage go through Texas probate? The loan itself does not go through probate, but the real property it's secured against generally does, unless the home was held in a revocable living trust or transferred via a Transfer on Death Deed. Probate is what gives the executor legal authority to sell the house — a separate process running in parallel with the lender's due-and-payable timeline.
What happens if the heirs simply do nothing? If heirs don't respond to the due-and-payable notice and don't request extensions, the lender can begin foreclosure proceedings to recover the debt through the home's sale. Heirs lose the opportunity to capture any remaining equity, and the foreclosure becomes part of the public record tied to the estate.
Can the extension period be longer than six months in Texas? In limited hardship circumstances — such as documented delays in obtaining probate court approval — servicers can sometimes grant extensions beyond the standard six-month maximum, but this requires proactive, written requests and is not automatic. Heirs should never assume an extension will be granted without formally asking.
Related Guides for Heirs and Senior Living Transitions
If you're managing this alongside a broader estate, our complete Texas probate guide covers the court process in full. If the heirs live outside Texas, see our out-of-state heirs guide. And if Power of Attorney was involved before the borrower's passing, our Power of Attorney and selling a house guide explains how that authority does and doesn't carry forward.
Explore the full Senior Living resource library and the Inherited & Probate resource library for more.
For informational purposes only. Not legal, tax, or financial advice. Consult a licensed Texas probate attorney and the loan servicer directly regarding your specific reverse mortgage and estate timeline. Zareena Samidon — Samidon Realty Group, 6407 Colleyville Blvd Suite B, Colleyville, TX 76034.