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Six steps advocates say would curb reverse mortgage foreclosure


Added 06-11-19 11:04:02pm EST - “Seniors are being harmed by reverse mortgage foreclosures, these steps can help prevent that in the future.” - News.yahoo.com

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Posted By TheNewsCommenter: From News.yahoo.com: “Six steps advocates say would curb reverse mortgage foreclosure”. Below is an excerpt from the article.

The U.S. Department of Housing and Urban Development oversees most reverse mortgages under its Home Equity Conversion Mortgage program. Since its growth in popularity in the 2000s, seniors have been swept into stressful situations if they default – jeopardizing the very asset they sought to keep.

HUD made incremental changes to the program in 2013 to curb full-draw loans, in which all the value can be pulled out in a single year; in 2014 to protect non-borrowing spouses who are not on the loan documents or the home’s title; and in 2015 to introduce a financial assessment tool that helps seniors plan for their spending alongside a reverse mortgage.

Advocates said several more steps would help stave off foreclosures and its fallout on borrowers, heirs and neighborhoods.

Cherelle Parker, a City Council member in Philadelphia, called reverse mortgages a scourge on her neighborhood. She said many seniors were targeted primarily to repair their aging homes.

She helped secure a $40 million city fund backed by public bonds for home loan preservation and repair that is available to what she called “middle neighborhoods.”

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