Is a New Reverse Mortgage Product in the Cards for Texas in 2013?

A Reverse Mortgage for Purchase in Texas could be a little bit closer to reality as primary voting season wraps up and new efforts toward introducing the loan in the state launch this week. 

Texas, the last state to allow for reverse mortgages, is still without the Reverse Mortgage for Purchase due to state legislation. While other states offer the Federal Housing Administration’s Home Equity Conversion Mortgage for Purchase, Texas will require a constitutional amendment in order for the Purchase to move forward. 

New efforts begin this week as the primary presidential voting season comes to an end. 

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“We will kick off in full force after the primary season ends,” says Scott Norman, past-president of the Texas Mortgage Bankers Association and vice president of Sente Mortgage’s reverse mortgage division. “We have already been working on this, and will continue heavily over the next six months.”

The 2012 presidential primaries closed in Texas on Tuesday with Mitt Romney winning the vote. 

Requiring a joint resolution and constitutional amendment, the introduction of the reverse mortgage purchase product in Texas is still many months away, Norman explains, looking ahead to November 2013. “The legislation comes back in January, so we are gaining support prior to that,” he says. 

The National Reverse Mortgage Lenders Association, too, has worked toward this effort in conjunction with regional support. 

“We continually work closely with Scott and the Texas MBA and we will keep apprised of the issue and be there to support  them and consult with them in any way they need,” said NRMLA Communications Director Marty Bell. 

The reverse mortgage Purchase market continues to comprise a small proportion of reverse mortgage loans at around 2.5% in March. Texas remains the second state for reverse mortgage loans overall, having surpassed Florida in terms of volume in early 2012. 

Written by Elizabeth Ecker

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