McCaskill Proposes Reverse Mortgage Amendment to Senate Bill

As lawmakers continue to file debate the Restoring American Financial Stability Act of 2010 (S. 3917) amendments, Senator Claire McCaskill (D-MO) and Senator Herbert Kohl (D-Wis) have introduced S.A. 3941, an amendment that would give the proposed Consumer Finance Protection Agency the authority to establish strict rules governing the sale of reverse mortgages.

The amendment states the director shall examine the practices of covered persons in connection with any reverse mortgage transaction and shall prescribe regulations identifying any acts or practices as unlawful, unfair, deceptive, or abusive in connection with a reverse mortgage transaction or the recommendation or offering of a reverse mortgage.

The amendment is focused mainly on ensuring the terms of the reverse mortgage are disclosed properly.  However, it does state that the Director should ensure there is a determination of the suitability of a reverse mortgage for a consumer, taking into consideration a range on issues including whether or not the mortgage intends to reside in the property on a long term basis.

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Additionally, it would prohibit any person from advertising a reverse mortgage in a manner that is false or misleading or fails to present equally the risks and benefits or reverse mortgages or fails to reveal negative facts that are material to a representation made in such advertisement.

You can see a copy of the amendment here.

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  • I just skimmed the amendment. As of record today, it has been submitted but not voted on. It is interesting that it was not cosponsored by a Republican but rather by Senator Herb Kohl of Wisconsin.

    Why anyone in Congress believes that the Director of the Bureau of Consumer Financial Protection should be assigned the responsibility for overseeing advertising and disclosures regarding the reverse mortgage industry is difficult to comprehend. It would seem that rather than more responsibilities, the Director should be involved in activities like catching future Madoffs, Stanfords, etc. Of course just to insure that there are no redundancies, “the Director shall consult with the Federal banking agencies, State bank supervisors, the Federal Trade Commission, and the Department of Housing and Urban Development, as appropriate, to ensure that any proposed regulation….” — another good use of the Director's and his bureau's time.

    Peter Bell is fond of saying that some of the worst consequences for the HECM program have resulted from our own marketing. Whoever sent that vile mailer to the mother of Senator McCaskill should be drummed out of the industry. Now the Senator is fixated on false advertising and failure to have sufficient disclosures. It is an obsession with her. Of course as some point out, there is the appearance of a conflict of interest with her husband's involvement in the nursing home industry.

    I only see the reverse mortgage industry as a distraction for what the Bureau Director must get down especially in the first few years of operation. It is hard to believe that two Democrats would propose tying up so many Bureau resources at the beginning of the Bureau in overseeing our industry.

    This amendment needs to be defeated.

  • When ever it sounds tooooo good to be True !!

    Then be verrrrry carefull , because not everyone will tell you the 100% Truth .

    Read , Read ,Read , Read ,Read , Read ,Read , Read ,Read , Read , BEFORE ! you sign your life away .

  • When ever it sounds tooooo good to be True !!rnrnThen be verrrrry carefull , because not everyone will tell you the 100% Truth .rnrnRead , Read ,Read , Read ,Read , Read ,Read , Read ,Read , Read , BEFORE ! you sign your life away .

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