Reverse Mortgage

Someone I know is about to arrange a reverse mortgage on her apartment to pay out the bank mortgage already in existence. She does not intend to tell the reverse mortgage financiers there is a Deed of some sort over the property for a debt of originally $50,000 which has ballooned out to $160,000 and by the time she passes will probably be double that amount, the Deed is not noted on the bank mortgage. Are there penalties for not disclosing this information.

 

Is it registered on the title?

 

No

 

A crime known as obtaining a finnacial advantage by deception may apply.

There may also be a fight over who has priority. Generally a registered mortgage will take priority over a non-resgistered where there is no knowledge of it

 

A bit harsh to keep them in gaol after they've died.

 

In Solitary confinement too.

 

Yes, it's called Financial Fraud, as @Terry_w has stated.

 

Banks are sophisticated, this is deliberate deception. If she is caught she will lose the property in addition to a criminal record.

 

extremely unlikely.

 

I'm confused how is there an existing deed over the property if nothing is lodged?
I know if I was lending someone >$50,000 and was under the provision of mortgage on a property, I would lodge that mortgage, or at least a caveat

 

Some people are very good at stuffing up their lives, spending without a thought of their old age and finding themselves in dire circumstances when it arrives. Thanks for your comments ...