Reverse mortgages could become a central part of Maine’s foreclosure law if the governor has his way.
Under new legislation proposed by Gov. Paul LePage, a Republican, any town considering foreclosure on a home due to unpaid taxes would have to first inform the residents of several potential relief options, including a home equity conversion mortgage, tax abatements, or a lien in which the town takes ownership of the property until the residents die, according to the Morning Sentinel of Waterville, Maine.
LePage’s concerns about foreclosures on elderly and lower-income Mainers intensified after he learned about the story of Richard and Leonette Sukeforth, two 80-year-olds who lost their home after the town of Albion, Maine foreclosed on it in December 2015 due to nonpayment of property taxes. LePage was reportedly angered by the situation and attempted to intervene directly, even inviting Richard Sukeforth to his State of the State address in February.
Though LePage didn’t specifically reference reverse mortgages in that speech, he did speak at length about foreclosures and elder housing issues.
“Communities and the Maine Municipal Association may do things right — they follow the law regarding tax liens and foreclosures. But they should do the right thing: Help the elderly stay in their homes,” LePage said, according to the state’s transcript of the address.
“It is unethical and immoral to take away a senior citizen’s home,” the governor continued. “They lose all the equity they built up during their lives. They end up on the street.”
The state has yet to release any specific details about the legislation, and multiple members of LePage’s press team did not return requests for comment from RMD. The Morning Sentinel reported that the governor expected to have the legislation before the state’s legislature sometime in February.
LePage, known in New England and across the country as a conservative firebrand, has advocated for HECM products in the past, telling a Turner, Maine beef farmer at a 2015 town hall meeting that “maybe we can get you a reverse mortgage,” in response to his concerns about his tax burden.
More recently, LePage suggested at a January town hall meeting in Biddeford, Maine that all fixed-income homeowners should have a home equity loan.
Written by Alex Spanko