McCaskill Introduces Reverse Mortgage Proceeds Protection Act

Posted by Orb Staff on December 17, 2007 No Comments
Categories : Residential Mortgage

Sen. Claire McCaskill, D-Miss., has filed legislation aimed at protecting seniors from aggressive marketing and predatory lending amid the rapid growth of the reverse mortgage industry. Senator Herb Kohl, D-Wis., chairman of the U.S. Senate Special Committee on Aging, is a co-sponsor.

According to McCaskill's office, the Reverse Mortgage Proceeds Protection Act would help to protect seniors by ensuring they receive independent counseling prior to signing up for a reverse mortgage and requiring that the U.S. Department of Housing and Urban Development (HUD) issue stronger regulations related to consumer protections.

The legislation, which has been endorsed by AARP, would allow HUD to use the Mortgage Insurance Premium (MIP) to help pay for independent counseling services. The bill would also require HUD to write new regulations to help ensure that seniors are not pressured or misled into purchasing related unnecessary or unsuitable financial products, such as annuities, long-term care insurance or life insurance, McCaskill's office adds.

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