Tag Archives: Reverse Mortgage

Federal Housing Administration commissioner Carol Galante announced Wednesday a series of changes to be issued this week that will allow the agency to better manage risk and strengthen its anemic Mutual Mortgage Insurance (MMI) Fund. The announced changes include consolidating FHA's reverse mortgage program, raising of mortgage insurance premiums, and requiring borrowers to continue paying annual insurance premiums for the entire life of their mortgage loans.

Despite significant current challenges in the reverse mortgage market, American Financial Resources, Inc., recently rolled out a full range of related loan products. Based in Parsippany, New Jersey, AFR Mortgage will launch the new initiative in the company's home state, giving borrowers who are over the age of 62 access to the specialty loans.

The CFPB released a report Thursday showing that although reverse mortgages are meant to help borrowers in retirement, they are in fact causing problems for many who don├â┬ó├óÔÇÜ┬¼├óÔÇ×┬ót fully understand them. A reverse mortgage is a type of home loan that lets older homeowners access the equity they have built up on their homes and defer loan payment until they sell the home, move out, or pass away. The original purpose of reverse mortgages was to allow these homeowners to convert home equity into retirement income.

Life insurer MetLife announced Thursday that it will exit the reverse mortgage origination business, with plans to sell the division responsible for these loans to Nationstar Mortgage LLC. It was not immediately clear how much Nationstar paid to buy the reverse mortgage portfolio from MetLife. The life insurer also said that it would cease receiving any new reverse mortgage loan applications and registrations. MetLife said that retail banking, including reverse mortgages, accounted for less than 2 percent of operating earnings for the company last year.

Senior home equity went up by $30 billion in the fourth quarter last year, leaving senior homeowners to account for $3.22 trillion in equity, according to a recent report. The National Reverse Mortgage Lenders Association collaborated with Risk Span to release the Reverse Mortgage Market Index. The results? The reverse mortgage market is stabilizing, according to the index, which registered 153.48 in the fourth quarter, up 0.9 percent from the third quarter.

HUD signed off on debarment Monday for three South Florida loan officers and a Pittsburgh title agent following convictions that found the four had reaped $2.5 million in reverse mortgage fraud. In a statement, the federal agency said that juries of their peers convicted loan officers Marcos Echevarria, Louis Gendason, and John Incandela for their roles in systematically identifying, then pressuring elderly homeowners to trade up their home loans for reverse mortgages. The three reportedly also committed appraisal fraud by exaggerating values for the properties to seize more funds.

On Friday HUD unveiled an infusion of more than $42 million in grants to housing counseling agencies, with some of the funds on the way from an historic $25-billion settlement reached with servicers several weeks ago. Of $36 million in grants made available to housing counseling agencies, $4 million will shore up services designed to help more elderly homeowners secure reverse mortgages and Home Equity Conversion Mortgages. More than 400 housing agencies across the nation will benefit from the availability of a flush of new funds.

Reverse Mortgages, special types of home loans that allow people to draw on home equity without monthly mortgage repayments, has become an answer for many older Baby Boomers when dealing with urgent financial issues, according to a study from the MetLife Mature Market Institute. Boomers aged between 62 and 64 currently represent one-in-five prospective borrowers of reverse mortgages, or Home Equity Conversion Mortgages, which was once associated with a much older age group.

In Maryland, Maverick Funding Corp. is rolling out a new branch of its subsidiary, Reverse Mortgage Network. Recently announcing the addition of 40 reverse mortgage loan officers from within Baltimore-based Great Oak Funding, Maverick will conduct its expansion during the first two quarters of 2012.

Life insurer MetLife announced Tuesday that it will cease originating forward residential loans and exit the business entirely. The company said in a statement that it would continue to service existing customers, even while it ceases accepting new loan applications for forward mortgages. MetLife also said that it would continue to originate reverse mortgages. MetLife said it expected to incur as much as $90 to $110 million in costs after tax next year for leaving the business.