FHA Goes “High Risk,” Reverse Mortgages Less Appealing?

ReverseFocusReverse Focus Weekly Podcast Episode #245

In this week’s Reverse Focus podcast, Shannon Hicks discusses a blog post from AARP that asserts reverse mortgages might be less appealing as a result of the Federal Housing Administration’s (FHA) upcoming product changes.

The elimination of the fixed-rate standard will not only restrict the amount borrowers can take in a lump sum draw, but will also reduce home equity in the future as a hefty portion will be set aside for tax and insurance payments, AARP’s blogger writes.

Also this week, because of FHA’s negative economic position, congressional watchdog agency the Government Accountability Office (GAO) has tagged the agency “high risk.”

But the label has not dissuaded investor appetite, as Hicks discusses the way in which some investors are buying up as many Saver securities as they can, expecting a tightening in pricing.

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Talking Points:

  • AARP: Changes could make reverse mortgages less appealing
  • GAO calls FHA “high risk”
  • Investor appetite remains despite product changes
  • Reverse borrowers still have other options

Listen Now. “Reverse Focus is the ultimate resource for reverse mortgage professionals providing the technology, training and marketing to grow your business. We are your one-stop resource for those committed to taking their business to the next level.”

Editor’s Note: These posts are sponsored by Reverse Focus.

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