In case you missed it, here’s what happened in reverse mortgage news this week.
[Update] Generation Mortgage To Exit Reverse Mortgage Originations — Generation Mortgage is winding down its reverse mortgage originations business including retail and wholesale operations, the company confirmed Wednesday. While the company will maintain its current pipeline of loans as well as its serving platform business, the company says its departure from reverse mortgage originations is due to falling reverse mortgage volume.
California Governor Passes Reverse Mortgage “Cooling Off” Bill – Reverse mortgage borrowers in California will soon have new protections following passage of a new law. The legislation, known among industry members as AB 1700 or California’s “cooling off” bill, requires that a new reverse mortgage worksheet be presented to and signed by all borrowers during the counseling process and a “cooling off” period of seven days after counseling before a lender can accept a loan application or assess any fees.
HUD Audit Finds Reverse Mortgage Borrowers Violated Residency Rules – The majority of borrowers under the Department of Housing and Urban Development’s (HUD) Home Equity Conversion Mortgage program (HECM) who were also enrolled in a rental assistance program did not meet reverse mortgage residency requirements, according to an audit by HUD’s Inspector General. As many as 136 out of 159 HECM borrowers were not living in the properties associated with their reverse mortgages because they were receiving rental assistance under a federal voucher program for a different address at the same time, according to findings.
WSJ: The Retirement Income Crisis is Real – The Wall Street Journal recently published letters from readers who strongly disagreed with Andrew Biggs’ and Sylvester Schieber’s Sept. 29 column, “The Imaginary Retirement-Income Crisis.” Readers said in contrast to the column’s assertion that politicians are creating a retirement income crisis, recent studies show that one of Americans’ biggest financial concerns is having enough money in their later years.
Column: Reverse Mortgages Often Misused – While Americans may one day find themselves in need of reverse mortgages, they are still an often misused financial tool, wrote financial planners Nathan Bachrach and Ed Finke in a recent Cincinnati.com column. The authors advise caution through four general principles: weighing additional options; understanding risks, costs and fees; researching the full impact; and being way of any salesperson who cites a reverse mortgage as part of an investment strategy.
Written by Cassandra Dowell