HUD Shuts Down Open-End Fixed Rate Reverse Mortgages, Tackles Deceptive Ads

ReverseFocusReverse Focus Weekly Podcast Episode #315

In this week’s Reverse Focus podcast, Shannon Hicks discusses additional extensions may be granted to non-borrowing spouses of reverse mortgage borrowers under new foreclosure timelines clarified by the Federal Housing Administration (FHA). Now, up to two 60-day extensions can be granted to spouses—one before the initiation of foreclosure and one during the process of foreclosure itself.

Also discussed, the Department of Housing and Urban Development (HUD) says it will not insure recent Home Equity Conversion Mortgages (HECMs) product variants that allow borrowers to take future draws against the principal limit at a fixed rate, following a similar ruling from Ginnie Mae just months ago.

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FHA continues to be at the center of attention in the past week as the agency issued a recent warning against deceptive and misleading reverse mortgage advertising, particularly practices that may steer a borrower to certain reverse mortgage product options.

Lastly discussed, the National Reverse Mortgage Lenders Association (NRMLA) responded to a recent article published by the Tampa Bay Times. The response defends the use of reverse mortgages, contrast to what the original article had dubbed “reverse mortgage complexities.”

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Talking Points:

  • FHA clarifies non-borrowing spouse foreclosure timeline.
  • HUD won’t insure open-end fixed rate HECMs.
  • FHA warns against product steering in advertising.
  • NRMLA’s Op-Ed response to Tampa Bay Times article.

Listen now. “Reverse Focus is the ultimate resource for reverse mortgage professionals providing the technology, training and marketing to grow your business. We are your one-stop resource for those committed to taking their business to the next level.” Editor’s Note: These posts are sponsored by Reverse Focus.

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