The U.S. Senate Special Committee on Aging held a hearing on Dec. 12 to examine the rapid growth of reverse mortgages and hear from those most affected by the expanding industry: seniors. With the senior population soaring as baby boomers reach retirement age, the committee looked specifically at ways to ensure consumers are protected as they consider this type of loan.
‘Seniors who have worked their entire lives to be able to enjoy retirement should not be victimized by people out to make a buck,’ said U.S. Sen. Claire McCaskill, D-Miss., who chaired the committee hearing. ‘We need to have adequate protections in place to ensure only those who would benefit from a reverse mortgage qualify. Without this, reverse mortgages could hurt as many seniors as they help.’
The hearing, which included the testimony from the U.S. Department of Housing and Urban Development (HUD), AARP, professionals in the reverse mortgage industry and family members of those financially harmed by reverse mortgages, marked the 20th anniversary of the Federal Home Equity Conversion Mortgage, a HUD program that allows people over the age of 62 to transfer equity on their homes into monthly income.
The hearing offered committee members the opportunity to hear feedback from those who know the reverse mortgage industry best, in an attempt to find ways to ensure that those who would not benefit from this type of loan don't find themselves trapped in a reverse mortgage, according to a statement released by McCaskill's office.
McCaskill said she plans to introduce legislation in the coming weeks to address concerns raised.