How will the Trump administration approach reverse mortgages?
Does one of the first decisions made by the Trump administration foreshadow the future of the reverse mortgage program? The administration’s decision to rescind a recent FHA mortgage insurance premium reduction was swift- within one hour after President Donald Trump took the oath of office. How will a business-minded administration approach the Home Equity Conversion Mortgage program?
Mortgage lenders should brace themselves for change. The Trump administration team made it clear they intend to dismantle the Dodd-Frank Act, a complex set of banking and lending regulations that have been criticized for their complexity and hurdles for middle class borrowers in obtaining credit. In addition the Consumer Financial Protection Bureau faces a substantial makeover. While both parties agree that consumer protections are needed, they disagree as to how that goal should be achieved.
Does this mean the Trump administration will be anti-reverse mortgage? By no means. However the ambition to reduce spending and waste should deliberate on the unintended consequences inherent in policy changes, specifically for today’s aging homeowners. With most retirees having less than $50,000 in savings the need to finance one’s longevity using their home has never been greater. Housing has become the lynchpin upon which the majority of American’s wealth is built.