March-April 2021

keep their name on the title they never have to pay on the loan as long as they live,” says Simmons, who warns against unsolicited calls from high-pressure salespeople. “You should be reaching out to the people you want quotes from, you should get at least three, and don’t let anyone pressure you into anything,” he says. View the segment at bit.ly/3nJP8Gl. In Washington, they’re talking about ... 2021 HECM Loan Limit Raised to $822,375 The national loan limit for Home Equity ConversionMortgages increased from$765,600 to $822,375 effective for case numbers assigned on or after January 1, 2021. This new maximum claim amount is also applicable to Freddie Mac’s special exception areas, which include Alaska, Hawaii, Guam and the Virgin Islands. NRMLA: Targeted Advertising Should Not Be a Fair Lending Violation In comments submitted to the Consumer Financial Protection Bureau (CFPB), NRMLA encouraged the bureau to clarify that age-targeted advertising is not a fair lending violation under the Equal Credit Opportunity Act (ECOA) and Regulation B. The CFPB requested comments on whether its dis- parate impact guidance with respect to ECOA and Reg B should be amended to provide greater clarity to lenders and consumers. NRMLA believes that greater clarity is necessary in this area, particularly because of the interplay between disparate impact, a consumer’s age and the necessities of reverse mortgage lending. “NRMLA respectfully asserts that it is not a fair lending violation, and in fact is to consumers’ benefit, for reverse mortgage lenders to be able to target advertisements for reverse mortgage products to those consumers who are old enough to be eligible to obtain reverse mortgages,” says NRMLA in its comments. The addition of language in Reg B recognizing that tar- geted advertising with respect to reverse mortgages is per- missible, and that reverse mortgage products may be offered solely to consumers age 60 or older, will enhance the abil- ity of reverse mortgage lenders to provide their products to those consumers who would most benefit from them. Read the full comments by logging into the Comment Letters section of nrmlaonline.org . Forward Mortgages Don’t Subsidize HECM In a blog post published in mid-December, consulting firm New View Advisors, Naples, FL, laid out a case for why the Home Equity Conversion Mortgage (HECM) program is not being subsidized by the Federal Housing Administration’s (FHA) forward mortgage program as men- tioned in FHA’s 2020 Annual Report to Congress. The blog also asserted that HECM is on course to be back in the black by the end of fiscal year 2021. “We think forward mortgage does not subsidize reverse mortgage now any more than reverse mortgage subsidized forward mortgage in 2009,” says New View Advisors. “A true subsidy would mean outsized realized HECM losses, and a compelling case that this will continue. This is not demonstrated in the report. In fact, given current trends, a reversal of fortune is possible, in which the HECM program returns to surplus and forward mortgage enters a deficit.” New View Advisors notes that there is a good and bad portion of FHA’s HECM book, the high-LTV pre-FA loans and the low-LTV FA loans. “With each passing day, the old riskier HECMs pay off, good new less-risky HECMs are added and the portfolio percentage comprised of FA loans grows larger.” Read the full analysis at bit.ly/3hpVsQO. And now you’re up to date. What’s News continued from page 9 LET US KNOW WHAT YOU’RE TALKING ABOUT. This forum is the place for readers to share their opinions with fellow colleagues about the direction of the reverse mortgage business and other retirement trends. Submissions should be limited to 100 words or less and submitted to Associate Editor Darryl Hicks, at dhicks@dworbell.com . 10 REVERSE MORTGAGE / MARCH-APR I L 2021