As implementation of Dodd-Frank reform bill gets underway, reverse mortgage lenders are preparing for whatever regulators might throw at the industry.
While the last few years have brought on many changes and increased scrutiny, one executive is confident about the way the industry operates.
“We’re happy having the industry being hyper regulated,” said Jeff Lewis, Chairman of Generation Mortgage in an interview with RMD during the National Reverse Mortgage Lenders Association annual trade show. “We don’t rip anybody off and we go out of our way to make sure that people are treated correctly.”
As part of the Dodd-Frank bill, the Consumer Financial Protection Bureau has the authority to issue regulations, orders, or guidance that apply to reverse mortgages.
The amendment was pushed hard by Rep. Representative Dina Titus (D-Nev) – lost her re-election earlier this month – who said, “while this financial product can be appropriate for some, it is important that the reverse mortgage lending industry be subject to appropriate regulation to promote transparency and sufficient consumer protections.”
Within the first year, the Bureau is also required to conduct a study on reverse mortgages to identify deceptive practices and figure out whether suitability standards are necessary.
Lewis told RMD the company doesn’t fear the report, “all it does is make the industry more easily sold to consumers.”
What bothers him most is the fact that because a reverse mortgage is a complicated transaction, something bad must be going on. “If this industry was actually dirty, we would all be out of business,” he said, “we can’t be hiding.”