In this week’s Reverse Focus podcast, Shannon Hicks discusses a blog post from AARP that asserts reverse mortgages might be less appealing as a result of the Federal Housing Administration’s (FHA) upcoming product changes.
The elimination of the fixed-rate standard will not only restrict the amount borrowers can take in a lump sum draw, but will also reduce home equity in the future as a hefty portion will be set aside for tax and insurance payments, AARP’s blogger writes.
Also this week, because of FHA’s negative economic position, congressional watchdog agency the Government Accountability Office (GAO) has tagged the agency “high risk.”
But the label has not dissuaded investor appetite, as Hicks discusses the way in which some investors are buying up as many Saver securities as they can, expecting a tightening in pricing.
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- AARP: Changes could make reverse mortgages less appealing
- GAO calls FHA “high risk”
- Investor appetite remains despite product changes
- Reverse borrowers still have other options
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Editor’s Note: These posts are sponsored by Reverse Focus.