The National Consumer Law Center, Americans for Financial Reform Education Fund, and 40 other groups sent a letter today to the U.S. Department of Housing and Urban Development (HUD) seeking stronger protections for reverse mortgage borrowers in response to the COVID-19 pandemic.
The agency has announced a 60-day halt on foreclosures of all FHA-insured mortgages, but this timeframe falls short in light of projections of the long-term impact of this crisis.
“HUD’s 60-day foreclosure moratorium was a crucial first step, but does anyone really believe older homeowners will have recovered from this crisis within 60 days?,” said National Consumer Law Center attorney Sarah Mancini. “Further action is needed to ensure that this older population, which is most vulnerable to the virus, will maintain stable housing and not end up facing unnecessary foreclosures.”
In commenting on HUD’s March 18, 2020 Mortgagee Letter announcing a limited 60-day moratorium of foreclosures, the groups urged HUD to take the following additional steps:
“Older Americans with reverse mortgage loans need these common-sense protections during a particularly frightening time,” said Linda Jun, senior policy counsel with Americans for Financial Reform Education Fund. “We urge HUD to take action quickly to provide this clarity and stability to reverse mortgage borrowers and lenders.”
NCLC Related Links
Covid-19 & Consumer Protections, including a list of all effective foreclosure moratoria.
Issue Brief: Recommendations to Improve Servicing and Reduce Foreclosures of Federal Reverse Mortgages (March 2020)
Testimony of NCLC attorney Sarah Mancini on reverse mortgages before the House Financial Services Committee, Subcommittee on Housing, Community Development, and Insurance (Sept. 25, 2019)