[vimeo id=”101740225″ width=”625″ height=”352″]
Does New Policy Spell Trouble for the Future?
What may have gone unnoticed by some may in fact turn out to be one of the most momentous policy decisions in the history of the HECM program: the non-borrowing spouse provision. Recently columnist Jack Guttentag (AKA “The Mortgage Professor”) penned a column on HUD’s new non-borrowing spouse policy and the resulting wrench the NBS policy throws into the gears of the Home Equity Conversion Mortgage program. Guttentag writes in part “Effective August 4th, more than will be thrown in the HECM gears, thanks to a misguided lawsuit by AARP against the Department of Housing and Urban Development, and a misguided change in HECM rules by HUD in response to the suit.”
First some context. Prior to the policy HECM borrowers with a younger spouse often removed the younger spouse from title whether they were 62 or older or not. Some even removed a spouse over 62 in an ill-advised attempt to benefit from a larger benefit in proceeds based solely on the one borrower’s age. Guttentag states that there is little credibility that seniors who removed a younger spouse from title did so without…
Looking for more reverse mortgage news, technology & training? Visit Reverse Focus here today.