Need Advice - Home with deceased owner, no will

[Zach Heim]

Looking for advice to try and take advantage of a situation. My wife has family living on a street that we love, but cannot realistically afford. We were alerted by said family member that a homeowner on the street has passed away. The home was in a reverse mortgage circa 2012 (allegedly it was/is FHA/HUD) and there is another lien on the house from a friend of the owner who lent him some $60 - 70k. The owner has no will and no immediate family. There is a brother out of state that wants nothing to do with the house. We were told the home would go to probate, but probate was never opened, and the home is now in pre foreclosure. From what I'm told by involved neighbors, the debt from the reverse mortgage and other lien holder is in the $700 - $800k range, $400k less than comps selling on that street. Is there anyways we can assume the debt or buy the house from the bank before it goes to foreclosure and is auctioned. From my research because it was an FHA/HUD loan, it must be sold to somebody who would occupy the home? Lots of moving parts here, but i'd appreciate any insight or advice. Home is located in Orange County, CA.

[Minna Reid]

You will not be able to assume this loan. Best bet is to wait until it forecloses and buy the house as a REO.