Former Federal Housing Administration Commissioner Brian Montgomery has become very vocal about why the Home Equity Conversion Mortgage (HECM) needs support from members of congress and it continues in the West Side Ledger.
As the reverse mortgage industry faces a reported $250 million shortfall for the HECM program in FY 2011, Montgomery tells WSL the product helps solve a social need for seniors in the country.
While Montgomery describes the $250 million as a “rounding error in the federal budget,” it has become more complicated as the reports of unscrupulous lenders have been published by the media and a call by some legislators to keep reverse mortgages from becoming the next sub-prime debacle. All of these factors make it a pivotal year for the program said Montgomery
“Seniors look at all these layers that start with the bad press and become reluctant about participating,” he said. “Of course, you’ve got a few members of Congress who now think they can save seniors from all that’s bad in the world and seniors read about that. Well, there just happens to be bad attorneys, veterinarians — even umpires. But we’re investigating HECMs? Give me a break …”