Wall Street Reform Bill Brings New Reverse Mortgage Oversight

A House-Senate conference committee early this morning gave final approval to sweeping financial services reform legislation, sending the bill back to the House and Senate and setting the stage for signature into law by President Obama before July 4th.

Lawmakers are calling the bill the Dodd-Frank Act after the two main architects, Senate Banking Committee Chairman Christopher J. Dodd (D-Conn.) and House Financial Services Committee Chairman Barney Frank (D-Mass.).  The final version of the bill incorporates the reverse mortgage amendment which was included as part of the House’s offer earlier this week.

“I am pleased that the Wall Street reform legislation includes an important provision that I have been fighting for that regulates reverse mortgages so that our nation’s seniors are not exposed to unfair and deceptive practices,” said Representative Dina Titus (D-Nev), the sponsor of the House amendment in an email to RMD.  “This effort will help ensure that seniors in their golden years do not lose their home and equity they have built up through a lifetime of hard work.”

The bill creates a Consumer Financial Protection Bureau which has the independent authority to write and enforce rules about consumer lending in mortgages, credit cards and other financial products.

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Housed in the Federal Reserve, the bureau is required to conduct a study on reverse mortgages to determine any deceptive or abusive practices within one year.  The study would also determine whether suitability standards are necessary, as well as safeguards to protect consumers from being sold reverse mortgages to fund inappropriate annuities, investments and other financial products.

The bureau also has the authority to issue regulations, orders, or guidance that apply to reverse mortgages prior to the completion of the study.

The final bill now travels to separate House and Senate votes and then, upon passage by Congress, to a Presidential signature into law.

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  • This has nothing to do with getting rid of anyone that is doing something wrong and everything to do with more regulating, more restrictions, less benefit for the borrowers.

  • Considering the NMLS has done nothing to separate the accountability of those doing traditional mortgages from those doing reverses, this is yet another example of one bureaucracy not knowing what the other is doing.rnrnThe federal and state exams ignore reverse mortgages and therefore do nothing to insure that those originating them know what they’re doing. So much for protecting seniors.

  • The reverse mortgage provisions in the bill won’t have much impact on most of us in the industry. nnWe’ve been negatively impacted far more by declining home values, HVCC, new disclosure requirements and limitations on origination fees. These have been offset partially by increases in HECM lending limits, low interest rates and premium pricing on fixed-rate HECMs. Not a bad trade-off, but watch for the upcoming increase in MIP.nnAll in all, not bad for an industry that’s chugging along at one-half the volume of a year ago.

  • It seems as if the members of the majority party in Congress who supposedly support HECMs are willing to throw all of us under the bus and add this ridiculous requirement and burden to the new director in the first year of the creation of this Bureau. Is there any government body left in DC which will not be writing regulations on reverse mortgages? rnrnOh yeah, there is always the Supreme Court, the CIA, the military, the Postal Service, the Department of Agriculture, the State Department, the Department of Labor, the IRS, the curators at the National Archieves, the National Park Service and of course the Office of the Vice President. rnrnI’m wrong; there are a few others left. Watch out though; their time may be coming soon.

  • It seems as if the members of the majority party in Congress who supposedly support HECMs are willing to throw all of us under the bus and add this ridiculous requirement and burden to the new director in the first year of the creation of this Bureau. Is there any government body left in DC which will not be writing regulations on reverse mortgages?

    Oh yeah, there is always the Supreme Court, the CIA, the military, the Postal Service, the Department of Agriculture, the State Department, the Department of Labor, the IRS, the curators at the National Archieves, the National Park Service and of course the Office of the Vice President.

    I'm wrong; there are a few others left. Watch out though; their time may be coming soon.

  • The reverse mortgage provisions in the bill won't have much impact on most of us in the industry.

    We've been negatively impacted far more by declining home values, HVCC, new disclosure requirements and limitations on origination fees. These have been offset partially by increases in HECM lending limits, low interest rates and premium pricing on fixed-rate HECMs. Not a bad trade-off, but watch for the upcoming increase in MIP.

    All in all, not bad for an industry that's chugging along at one-half the volume of a year ago.

  • Considering the NMLS has done nothing to separate the accountability of those doing traditional mortgages from those doing reverses, this is yet another example of one bureaucracy not knowing what the other is doing.

    The federal and state exams ignore reverse mortgages and therefore do nothing to insure that those originating them know what they're doing. So much for protecting seniors.

  • This has nothing to do with getting rid of anyone that is doing something wrong and everything to do with more regulating, more restrictions, less benefit for the borrowers.

  • The reverse mortgage provisions in the bill won’t have much impact on most of us in the industry. nnWe’ve been negatively impacted far more by declining home values, HVCC, new disclosure requirements and limitations on origination fees. These have been offset partially by increases in HECM lending limits, low interest rates and premium pricing on fixed-rate HECMs. Not a bad trade-off, but watch for the upcoming increase in MIP.nnAll in all, not bad for an industry that’s chugging along at one-half the volume of a year ago.

  • Considering the NMLS has done nothing to separate the accountability of those doing traditional mortgages from those doing reverses, this is yet another example of one bureaucracy not knowing what the other is doing.rnrnThe federal and state exams ignore reverse mortgages and therefore do nothing to insure that those originating them know what they’re doing. So much for protecting seniors.

  • This has nothing to do with getting rid of anyone that is doing something wrong and everything to do with more regulating, more restrictions, less benefit for the borrowers.

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