Detailed Answer
Short summary: If your father had a reverse mortgage, the loan generally becomes due when he dies. The servicer (lender) may ask heirs to sign “renunciation” or other forms to confirm who will act, who will sell the home, or to avoid opening probate. You have several practical options: (1) get formal authority from the probate court (Letters of Office) so one person can sell, (2) have all heirs sign the documents the servicer needs to authorize a sale or payoff, or (3) let the lender proceed under its remedies (including foreclosure). Which option is right depends on who holds title, whether you are a named personal representative, and whether the loan is a federally-insured HECM (Home Equity Conversion Mortgage). This article explains how to proceed under Illinois law and what to ask the servicer.
Why a lender requests renunciation letters
“Renunciation” can mean different things. In this context the lender is most often asking for one of two things:
- A renunciation of the right to be appointed personal representative (so one heir can be appointed without all heirs contesting), or
- A written waiver or release from heirs (e.g., a statement that they will not object to a sale, that they won’t claim occupancy rights, or that they consent to a particular person handling the payoff).
The lender requests these papers to reduce legal uncertainty before accepting payoff funds or releasing title. If the servicer can rely on a single document rather than having to open probate and obtain court-issued Letters of Office, it may accept a sale closing more quickly.
Step-by-step: What to do in Illinois
- Get the facts and documents
- Obtain a certified death certificate for your father.
- Ask the reverse mortgage servicer in writing for: the current payoff amount, a payoff/repayment quote, the account statement, and a precise explanation of the written forms they want (including sample renunciation/waiver forms).
- Confirm whether the loan is a HECM (FHA-insured). If it is, HUD/FHA rules and servicer policies will apply; HUD provides guidance for heirs on HECMs.
- Identify who owns title and whether a probate exists or is needed
- If title is solely in your father’s name, the property typically must pass through probate in Illinois unless a valid transfer-on-death, joint tenancy with right of survivorship, or other non-probate mechanism exists.
- If multiple people are on title, all owners must cooperate to convey the property.
- Compare two common ways to give the servicer what it needs
- Probate route: Open a probate and obtain Letters of Office (court appointment of a personal representative). Present the Letters of Office to the servicer — courts provide clear legal authority to sell the property, which many servicers accept instead of renunciations. Illinois probate law is codified in the Illinois Probate Act (755 ILCS 5). See: https://www.ilga.gov/legislation/ilcs/ilcs3.asp?ActID=2106&ChapterID=60
- Heir agreement route: If heirs are willing, have all heirs sign the specific written waiver/renunciation forms the servicer requests (or sign a deed or consent to sale). Many servicers will accept fully executed heir waivers or a deed from all owners in lieu of probate.
- Use HUD/FHA resources if the loan is a HECM
HECM rules give heirs specific options (e.g., repay, refinance, sell, or convey the property to the insurer/lender). Contact HUD or review HUD’s HECM guidance so you know deadlines the servicer must follow. HUD’s HECM page: https://www.hud.gov/program_offices/housing/sfh/hecm/hecmhome
- If the servicer keeps insisting on renunciations:
- Ask the servicer to identify the exact legal authority they rely on and to provide a written explanation of why probate Letters of Office or a deed from all heirs would not suffice.
- If a specific form is required, request an editable copy so heirs can review and consult counsel before signing.
- Consider opening probate (even if you expect a short or uncontested estate). A routine, uncontested probate provides documentary proof of authority that most servicers accept and avoids ambiguous renunciations.
- If heirs refuse to sign or you can’t find all heirs
You may have to open probate and obtain court authority to sell. In contested situations the court can resolve who controls the sale. An Illinois probate or real estate lawyer can explain whether an affidavit of heirship, quiet-title action, or other filing fits your situation.
- Keep records and act quickly
With reverse mortgages, servicers will move to enforce the loan if deadlines lapse. Keep copies of all requests, payoff quotes, and correspondence. If you are selling, line up buyers and a title company early so you can close within any payoff window the servicer sets.
What if the servicer won’t accept Letters of Office or a deed?
Ask for a written refusal explaining the legal basis. If they cite servicing guidelines rather than law, you can escalate to HUD (for HECM loans) or to the Consumer Financial Protection Bureau (CFPB) and the Illinois Department of Financial and Professional Regulation. You may need an attorney to enforce your right to sell or to negotiate a payoff, short sale, or deed-in-lieu of foreclosure.
Probate basics in Illinois (quick overview)
In Illinois, probate is the usual process to appoint a personal representative and transfer title when a decedent owned real estate in their name alone. Probate rules are in the Illinois Probate Act (755 ILCS 5). Probate gives you court-issued letters that prove your authority to sell and to sign payoff documents. Even a short, straightforward probate can be faster than litigating family disputes and can settle servicer demands for renunciations.
Useful links and resources
- Illinois Probate Act (general): https://www.ilga.gov/legislation/ilcs/ilcs3.asp?ActID=2106&ChapterID=60
- HUD HECM (reverse mortgage) program page: https://www.hud.gov/program_offices/housing/sfh/hecm/hecmhome
- Consumer Financial Protection Bureau: https://www.consumerfinance.gov/
When you should strongly consider a lawyer
Hire a probate or real estate attorney if any of the following apply:
- Heirs disagree about selling or signing renunciations.
- The servicer refuses to accept Letters of Office or a deed from all owners and won’t explain why in writing.
- There is substantial equity and you want to protect that equity during sale negotiations.
- You need to perform a short sale, negotiate a deed-in-lieu, or defend against foreclosure.
Disclaimer
This information is educational only and is not legal advice. Laws change and individual situations differ. For advice tailored to your facts, consult a licensed Illinois attorney.
Helpful Hints
- Get everything from the servicer in writing: payoff quotes, deadlines, and the exact forms they want.
- If you’re the named personal representative, give the servicer a certified copy of the Letters of Office from the probate court.
- If all heirs can cooperate, a signed deed from all owners or a joint waiver may avoid probate.
- Keep a certified copy of the death certificate ready — servicers will ask for it.
- If the loan is a HECM, read HUD’s HECM servicer guidance and escalate to HUD if a servicer is not following FHA rules.
- Record and save all phone calls, emails, mail, and documents you send and receive from the servicer.
- Before signing any renunciation or waiver, consider getting a short consultation with an Illinois probate attorney so you understand what right you may be giving up.
- If time is tight, ask the servicer for an extension in writing and explain your plan (probate filing, listing a sale, etc.).