IMHO, you should want to know if you are signing up for a mortgage that far exceeds the value of the property. If this is the case than this conversation goes a completely different direction.
Example, there are condos near where I live where everyone paid @ $80K for them @ 10 years ago. Last year these small, decent, two-bedroom, & two-bath condos were selling for $39k-$43K. Borrowing $60-70K on a $40K property in my example may not be a good plan.
YMMV
Don’t think it matters – i can’t get another loan for anything now because my credit is ruined, and, so I have no possibility of buying some other place. And I can’t negotiate about the terms of this deal. It’s a take it or leave it offer.
Not a thing if you could predict the exact date of your death. If you could do that then borrow 10 billion and ride off into the sunset. The problem is that if you start borrowing as much as you can in anticipation of death, you might live a year longer than you planned and be living in an old milk carton.
Banks have appraisals to prevent this.
But you (and we) can’t judge the relative value of the offered mortgage without knowing. Maybe the loan will instantly put you way underwater, saving the bank’s financial bacon at your expense. Maybe you will be better in all respects just walking away from the property.
For someone who wants some hard answers on which to make a choice, you’re curiously flip about the important details.
First off, foreclosure is a legal process. Banks can’t do it on a whim, and they really don’t want to. I’m not a lawyer, and laws vary by state anyway, but most banks are happy as long as someone keeps making the payments. There should be plenty of time for the estate to either sell first, or to have someone take over the mortgage.
Secondly, foreclosure prices are not bad because the banks don’t care about getting top dollar. They’re bad prices because of how a foreclosure works - usually it’s an auction-type setting with buyers who may or may not have seen the house, and the house is going to sell that day, at some price. Compare that to a normal home sale in which the owners list the house, show it to buyers, compare multiple offers and do all of this with the freedom to refuse any offer and keep waiting for a really good one.
Don’t worry about it. We refinanced our house with a 30 year mortgage when we were 60. Dying before the loan is paid off is no big deal. We’ll probably move first though.
And so will you. Are you sure you’re going to want that house at age 75 or 80? By then your credit might be a lot better also. And you might have some equity from general price increases. Basically, I think you did good.
The only downside for you is knowing the bank is making a 76% return on their investment (assuming you die in 20 years or so), which is money out of your heirs’ pocket. As long as you can look past that, you’re solid gold.