It has been a busy week for reverse mortgage news, to say the very least.
The parent company of a top-10 industry lender announced its exit from reverse mortgage originations, and the Department of Housing and Urban Development (HUD) finally released its final rule detailing a variety of changes to the Home Equity Conversion Mortgage (HECM) slated to take effect this year. And those were only two breaking news headlines the industry saw over the last few days alone.
In case you missed the rest, here are the top reverse mortgage news stories grabbing the attention of RMD readers during the past week:
Walter Shuts Down RMS, S1L Reverse Mortgage Originations—Walter Investment Management Corp. (NYSE: WAC) announced this week that the company is exiting the reverse mortgage origination business, including its wholesale and retail channels under the Reverse Mortgage Solutions (RMS) and Security One Lending brands. Walter, however, will continue to maintain its reverse mortgage servicing operations under RMS, the company told RMD.
HUD Finally Issues Long-Awaited Program Changes for Reverse Mortgages—Eight months since it issued proposed rules for the HECM program last May, HUD finally issued its final rule on Thursday, in which the agency spelled out several program changes the agency has slated to take effect September 19, 2017. The final rule codifies several significant changes to the FHA’s HECM program that have been implemented over the years, and makes additional regulatory changes.
HUD to Launch New Loan Review System for Reverse Mortgages—Earlier in the week, HUD announced plans to roll out a new loan system for reviewing certain FHA loans, including reverse mortgages. Mortgagee Letter 2017-03 described FHA’s plan to implement a new Loan Review System, which will be used to manage Title II Single Family Loan Reviews, Title II Single Family Mortgagee Monitoring Reviews, and Mortgagee self-reporting of fraud, misrepresentation and other material findings.
Trump Treasury Pick’s Ex-Firm Subject of New Reverse Mortgage Investigation—New York Attorney General Eric Schneiderman opened an investigation into the reverse mortgage practices at a company formerly owned by Steven Mnuchin, just days before the Trump pick for U.S. Secretary of the Treasury testified during a nomination hearing before a Senate finance committee. Specifically, the N.Y. Attorney General’s Office is currently examining practices related to the servicing of reverse mortgages at Financial Freedom, the reverse mortgage unit of Mnuchin’s OneWest Bank.
Reverse Mortgage-Backed Securities Market Shrinks for First Time—The HECM mortgage-backed securities (HMBS) market shrank for the first time as a record level of prepayments drove total outstanding HMBS to just under $55 billion, according to the latest market commentary from New View Advisors.
Written by Jason Oliva