The RMD article Tax Consequences Resulting from Foreclosure on a Reverse Mortgage, pointed out that there are income tax consequences to borrowers from reverse mortgage (and other nonrecourse) debt that is forgiven in foreclosure, short sales, trustee’s sales, and deeds in lieu of foreclosure (all referred to in this article as “foreclosure”); these tax rules […]

Ding Ding!  Here comes “Round 2” from Atare Agbamu in his second installment of An Assault on Fairness: Quash Mortgagee Letter 2008-38 (Part 2).  In Round 2, he discusses how the arms-length rule in the ML has the potential to arouse anger and alienate seniors’ heirs and relatives, which he calls the “core centers of […]

One of the most perplexing aspects of the Home Equity Conversion Mortgages (HECMs) is the income tax consequences of forgiving (or canceling) any portion of the balance due through short sale, foreclosure, trustee’s sale, or deed in lieu of foreclosure. (This article does not address the income tax consequences of abandonments.)  The complexity stems from […]

Cross-selling engenders heated arguments. Some believe that cross-selling strikes at the heart of free enterprise and the rights of seniors to make their own decisions. Based on past performance, others believe that seniors need these protections.
Although this series of articles focuses on the cross-selling restrictions of HERA (the Housing and Economic Recovery Act of 2008, […]

With echoes of earlier calls for “net tangible benefits” from the forward world resonating, suggestions now are being floated for “financial assessments” of seniors in the mood for a reverse mortgage. Washington, D.C. attorney Jim Milano says “one policy [question] floating around is whether seniors need some kind of financial assessment and, if so, who […]

Along with the recent changes to HECM counseling, the Department of Housing and Urban Development is expected to unveil a new counseling protocol next month to help borrowers asses whether a reverse mortgage is the right choice for their financial situation. 
The new protocol will include stronger assessment tools as well as the creation […]