CFPB On Reverse Mortgage Deadline, Calling on Lenders

The Consumer Financial Protection Bureau is under way with a reverse mortgage study that has the potential to drive regulation in the coming year. In its first-ever annual report to Congress, the new bureau noted work on the study, in addition to a separate research endeavor that seeks to determine best practices for financial advisors who work with older Americans.

“The reverse mortgage study is in progress and we are working to meet the July 21 statutory deadline,” a CFPB spokeswoman told RMD in an email. “We have started to reach out to industry participants for information, and we will continue to do so over the next several months.” That study is being conducted by the bureau’s Research and Markets team, and is a stipulation mandated by Dodd-Frank, which also specified the creation of the agency when it was signed into law in July, 2010.

A separate effort is also under way by the CFPB’s Office of Older Americans to protect older consumers with regard to financial products. That office, established in October, is led by director Skip Humphrey who told RMD in a press call upon his appointment that the office will work toward protecting seniors’ homes.

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“Recommendations on best practices concerning financial advisors who work with older Americans is a separate effort and work on those recommendations is underway,” the spokeswoman told RMD. “More details about both efforts will be announced when this material is ready for public dissemination.”

Until then, reverse mortgage advisors and “industry participants” may receive calls from the CFPB on their practices for research purposes. The agency has not specified whom those participants will be.

Additionally, the agency’s enforcement of regulations concerning non-bank lenders could warrant separate visits from the CFPB, with that enforcement being projected to begin any day.

Written by Elizabeth Ecker