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Tag Archives: Reverse Mortgage

Senate Committee Proposes Bill to Put FHA on ‘Stable Footing’

The Senate Banking Committee reached a milestone in its efforts to stabilize the Federal Housing Administration (FHA) with the release of a discussion draft of a new bill Monday. The Federal Housing Administration Solvency Act of 2013, authored by Committee Chairman Sen. Tim Johnson and Ranking Member Sen. Mike Crapo (R-Idaho), has provisions to strengthen underwriting, make lenders more accountable, and strengthen the FHA’s reverse mortgage program.

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Consumer Advocates: HECMs Need Revisions to Prevent Defaults

Home Equity Conversion Mortgages (HECMs) and reverse mortgages, tools to which many seniors turn to help manage expenses in their later years, can be challenging products to navigate, according to testimonies delivered during a Senate committee hearing Tuesday morning. While the Department of Housing and Urban Development (HUD) considers changes to the HECM program, the Senate Committee on Banking, Housing, and Urban Affairs held a hearing to determine the best path forward for the program.

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Stats Show Troubling Trends for Reverse Mortgages

While reverse mortgages can be a boon to seniors as they head into retirement, a new report from the National Center for Policy Analysis (NCPA) says recent trends show trouble in the market that may cost taxpayers billions of dollars. According to a 2012 MetLife survey, two-thirds of borrowers are now using reverse mortgages to pay down debt. Pamela Villarreal, a senior fellow at NCPA, expects the ""troubling trend will increase as more baby boomers enter retirement with mortgage debt than previous generations.""

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Walter Investment Completes Reverse Mortgage Deal with Wells Fargo

Walter Investment Management Corp. announced Tuesday that its wholly owned subsidiary, Reverse Mortgage Solutions, Inc. (RMS), has acquired a reverse mortgage servicing portfolio containing more than 76,000 loans from Wells Fargo Home Mortgage. The portfolio has an unpaid principal balance of about $12.2 billion and is expected to transfer to RMS during the third quarter of 2013, Walter Investment said in a release. The transaction will double the size of Walter Investment's serviced book, according to CEO and chairman Mark J. O'Brien.

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Agencies Target Companies for Tactics Used in Mortgage Ads

Two federal agencies partnered up to let certain companies know their mortgage advertising tactics may be unlawful. On Monday, the Consumer Financial Protection Bureau (CFPB) and the Federal Trade Commission (FTC) announced letters were issued over potentially misleading advertisements that target veterans and older Americans. The CFPB sent about a dozen warning letters to mortgage lenders and brokers, and the FTC sent 20 letters to real estate agents, home builders, and lead generators.

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Reverse Mortgage Lenders Commit to Help Settle Confusion

Following a CFPB report that linked foreclosures to confusion over reverse mortgages, the National Reverse Mortgage Lenders Association (NRMLA) is seeking to help seniors make responsible decisions about their mortgages. NRMLA announced that it has developed a series of tools designed to help seniors better understand the facts about reverse mortgages before they choose to use them. A common misconception about reverse mortgages, the CFPB revealed, is that they are a government benefit rather than a financial product.

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Reverse Mortgages Put Confused Homeowners at Risk of Foreclosure

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 an income stream or line or credit to use in retirement. Reverse mortgages require no monthly mortgage payments, but borrowers must still pay property taxes and homeowner's insurance. The CFPB released a report that showed nearly 10 percent of reverse mortgage borrowers are at risk of foreclosure because they failed to pay those costs.

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Ocwen Looks to Increase Market Share

Ocwen Financial continues to make moves to expand its portfolio. The special servicer disclosed in a filing with the Securities and Exchange Commission that it has agreed to purchase $15 billion in mortgage servicing rights from JPMorgan Chase. It's the latest in a string of transactions bolstering Ocwen's portfolio, and the company's not stopping there. Ocwen says a new venture will allow it to compete for the servicing rights of newly originated FHA loans. It is also looking to expand into reverse mortgages and home equity lines of credit.

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Celink Rolls Out SPOC Technology for Reverse Mortgage Borrowers

Celink, a reverse mortgage subservicer, has implemented a single point of contact (SPOC) module for its clients' borrowers who are in default status. The company's servicing platform auto-assigns a borrower in default to a Celink associate. This associate works exclusively with the borrower until they remedy the default. They will remain the borrower's SPOC through the remediation or foreclosure process. Celink SPOCs are only assigned to a small number of accounts so that associates can provide personalized service.

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Default Risk in Reverse Mortgage Sector Prompts Lender Exodus

Reverse mortgage businesses accounted for a bigger share of industry casualties during the first half of 2011. Data released Tuesday shows that three lenders, which together made up 46 percent of the market for FHA's reverse mortgage program, called it quits earlier this year. The study noted that one factor impacting the dwindling sector is the possibility that borrowers will miss insurance or tax payments, which can trigger default on federally insured loans.

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