Actor and pitchman Tom Selleck, among others, has helped persuade more than 1 million seniors in markets like Palm Beach County that reverse mortgages are not “too good to be true.”
But a federal agency overseen by Housing Secretary Ben Carson of Palm Beach Gardens says an insurance program backing reverse mortgages is “losing money and can no longer remain viable in its present form.”
Foreclosures in reverse mortgages climbed to more than 3,600 a month last year, up from less than 500 a month in prior years, according to government data analyzed by nonprofit groups.
A 92-year-old Florida woman with a reverse mortgage faced a foreclosure filing because she owed 27 cents, a legal aid group said.
New York Attorney General Eric Schneiderman is investigating practices related to the servicing of reverse mortgages at Financial Freedom, a part of OneWest Bank, and at Champion Mortgage, a unit of Nationstar Mortgage, as the state further heightens its recent focus on reverse mortgages, an article in The Wall Street Journal by Annamaria Andriotis stated.
“The inquiry, which is in early stages, is examining whether businesses employed tactics that pushed elderly borrowers into foreclosure,” the article sated.
American Advisors Group, Reverse Mortgage Solutions and Aegean Financialare the latest names to face the wrath of the Consumer Financial Protection Bureau due to deceptive advertisements in reverse mortgage lending.
Collectively, the bureau ordered the three reverse mortgage lenders to pay a civil penalty of $790,000.
New York lawmakers are moving to boost protections for reverse-mortgage borrowers in foreclosure — after a report by The Post.
Last month, The Post broke the story about a rising tide of foreclosures on reverse mortgages, risky home equity loans made to senior citizens. This wave of foreclosures threatens to throw some of New York’s most vulnerable residents out on the street.
Now Assemblywoman Helene Weinstein (D-Brooklyn) and Sen Jeff Klein (D-Bronx/Westchester) have introduced bills aimed at providing second-mortgage holders with the same protections as first-mortgage borrowers.
There are two key changes. The first is written notification, including a notice with contact information for free nonprofit foreclosure-prevention assistance, to the borrower 90 days before the lender files a foreclosure case. In addition, the new law will mandate a settlement conference for borrower and lender to try to work out a deal under the watchful eye of a judge or court-appointed referee.
The New York State Department of Financial Services has launched a wide-ranging probe into Reverse Mortgage Solutions and Champion Mortgage’s reverse-mortgage operations, following a story by The Post.
Last Sunday, The Post broke the story of a sharp uptick in foreclosure cases against New York homeowners with reverse mortgages — risky home-equity loans made to senior citizens.
Ailing Howard Beach homeowner Frederick Feil, 67, fears he’ll become homeless if he loses a foreclosure battle against Finance of America Reverse on a loan serviced by RMS. The foreclosure filing didn’t include the amount of the alleged arrears — a common omission in these cases, for which delinquent charges total on average just $10,000, legal services attorneys say.
When Frederick Feil took out a reverse mortgage on his Howard Beach home, he thought he was ensuring a comfortable future — not putting himself at risk of becoming homeless.
Feil, 67, who has a heart stent and undergoes dialysis treatments, is desperately fighting to prevent Finance of America Reverse from tossing him out of his home.
Feil took out a $353,000 reverse mortgage in December 2011, using all but a few thousand dollars to repay an earlier mortgage and cover hefty origination fees. Feil told The Post he fell behind on property taxes while in the hospital last year — and unexpectedly found himself in foreclosure last March when Finance of America Reverse called the entire balance, which has ballooned to $449,583.85 from interest and other charges, due.
A federal appeals court has rejected claims that Wells Fargo and Freddie Mac unlawfully foreclosed on homes of consumers with reverse mortgages after their deaths and violated rights of heirs to purchase the homes.
In a decision on Thursday, the 9th Circuit Court of Appeals affirmed a lower court’s dismissal of the case, saying federal guidance on reverse mortgages, “while not entirely clear,” did not support claims of borrowers’ heirs.