Reverse mortgage reform is a leading concern in California, with the California Senior Legislature rating reverse mortgage transparency legislation as a top-ten state priority. In the past few months, the state has focused on other reverse mortgage legislation, recently passing a bill to prohibit reverse mortgage and insurance cross-selling.
The 31st Annual Legislative Session, which adjourned in October, released a list of California’s top ten state legislative proposals that were given priority for enactment into law in 2012. The Reverse Mortgage Transparency Act, AP-32, ranked third on the list.
“The Reverse Mortgage Transparency Act would require reverse mortgages to allow the borrower to determine the consequences of the mortgage based on their personal situation, financial circumstances, health and long-term needs,” reads a summary of the proposal.
A California Senior Legislature spokesperson said that more information on the proposal will be available in January 2012.
The west coast state has recently taken other steps to reform reverse mortgage referral practices. In September, Governor Jerry Brown signed into law a bill that aims to prevent inappropriate conduct by insurance professionals toward seniors with reverse mortgages. The bill is designed to prohibit cross-selling and stop insurance agents from making referrals to anyone who is involved with selling reverse mortgages.
Other top-ten state proposals include a missing persons program to protect those suffering from Alzheimer’s or dementia who may wander away from home; requiring money wire transfer services to be included in the definition of mandatory reporters of suspected financial elder abuse; and increasing the penalty for identity theft of victims aged 65 or older.
The California Senior Legislature is a nonprofit, nonpartisan political organization whose members are elected by California seniors.
Written by Alyssa Gerace