Reverse Mortgage changes

Oakland, CA(Zone 9b)

New Barriers To Reverse Mortgages
SmartMoney Nov 22, 2011
Full article at: http://blogs.smartmoney.com/encore/2011/11/22/new-barriers-to-reverse-mortgages/?blog_id=194&post_id=448

Changes are in store for the way reverse mortgages are processed that might make it more difficult for some borrowers to qualify.

....the U.S. Department of Housing and Urban Development, which oversees FHA, is working on new regulations–likely to debut in 2012–that would require lenders to perform such financial underwriting. As a result, “it is possible that some borrowers who could have gotten a reverse mortgage before” will no longer qualify."

The new regulations are also likely to give lenders the right to require borrowers with smaller financial cushions to receive monthly payments, rather than a lump sum. To ensure that borrowers have enough cash to cover their property taxes and homeowner’s insurance premiums, the new regulations may also allow lenders to set aside a portion of a reverse mortgage’s proceeds for those expenses."

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