Waters Introduces Legislation to Help Prevent Unfair Foreclosures on Seniors with HUD Reverse Mortgages
Today, Congresswoman Maxine Waters (D-CA), Ranking Member of the Committee on Financial Services, introduced the Preventing Foreclosures on Seniors Act, a bill to make reforms to the U.S. Department of Housing and Urban Development’s (HUD’s) reverse mortgage program to help prevent unfair foreclosures on seniors. HUD’s Home Equity Conversion Mortgages (HECM) program allows seniors to take out reverse mortgages, which convert a portion of their home equity into cash to supplement their income in retirement.
“Unfair foreclosures on seniors continue to be a problem in the Department of Housing and Urban Development’s reverse mortgage program. This bill makes key changes to help seniors who are vulnerable to foreclosure under the current program,” said Ranking Member Waters. “It is critical that we take every possible step to ensure that seniors who take out reverse mortgages, and particularly their surviving spouses, do not unfairly lose their homes.”
Congressman Denny Heck (D-WA) is an original cosponsor on the bill.
“This bill would provide much needed protections for older borrowers with reverse mortgage loans. It would require lenders to give seniors a chance to stay in their homes by repaying back taxes and insurance when they can afford to do so,” said Alys Cohen, Staff Attorney for the National Consumer Law Center. “It also would protect spouses left off a reverse mortgage from needless foreclosure by requiring that eligible spouses be given the opportunity to remain in their home. These are common sense steps that would protect older borrowers and preserve the reverse mortgage program by making it work better.”
The bill makes reforms to HUD’s Home Equity Conversion Mortgages (HECM) program to: