HOUSINGNEWS REPORT
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LEAD ARTICLE
Reverse Mortgages: Can Financing for Seniors Change with the Times?
BY PETER G. MILLER, STAFF WRITER
For decades Federal Housing Administration-backed reverse mortgages were a pleasant and profitable federal business. Seniors used them to age in place and pull equity from their homes. Lenders had a niche product to market. Everyone was happy. The U.S. Department of Housing and Urban Development prized reverse mortgages — what it calls home equity conversion mortgages (HECMs)
— so much that in 2000 it hiked allowable origination fees to attract more lender activity and in 2004 partnered with AARP to push the program even further. The issue, says David H. Stevens, is not the potential value to seniors, but the cost to taxpayers. “I agree the program concept has a role to fill the needs for seniors, but the question is why the taxpayer is
footing the bill for a product that produces billions in forecasted losses and drains the reserves of the fund, risking more taxpayer bailouts in the future,” Stevens, the former President and CEO of the Mortgage Bankers Association and a past FHA Commissioner, told the Housing News Report
How big a drain? In fiscal year 2018, said HUD, the HECM program had
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DEC 2018 | ATTOM DATA SOLUTIONS
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