Quote:
Originally Posted by Plinker
Taxpayers On Hook For Billions Of Dollars Every Year
This from the Heritage Foundation: 2017
“Because of the largesse of federally financed subsidies in the Federal Housing Administration’s reverse-mortgage program, the federal government has gradually crowded out private insurers from the market for these financial products since the program began in the late 1980s.
Indeed, amid the multi trillion-dollar maze of federal insurance and guarantee programs lies the Federal Housing Administration Home Equity Conversion Mortgage program—an insurance program providing loss coverage on reverse-mortgage originations backed by federal taxpayers.
The loan program simply has become a severe financial burden for federal taxpayers. The Federal Housing Administration reports that the Home Equity Conversion Mortgage program faces a financial shortfall totaling roughly $14 billion in fiscal year 2017.
To avoid any further compounding of the fiscal fiasco, policy leaders should wind down the federal Home Equity Conversion Mortgage program, and in the interim certainly refrain from any misguided reforms that would increase moral hazard, put more taxpayer money at risk, and ultimately continue to crowd out private mortgage insurers from the market for reverse mortgages.”
I was stunned when I read this. This is a fact a salesman will never reveal.
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It is likely much, much more by now. It takes time to acquire and process data like this and may take three or four years.
Thank you for posting this. If it saves even one gullible Villager from jumping off the reverse mortgage financial cliff your post will have been worthwhile.
I found that the bleeding of taxpayers due to reverse mortgages going bad continues.
"HUD: Reverse mortgages continue drain on FHA insurance fund
Subsidy rate holds steady in Q2 as program becomes more burdensome for FHA"
From a June 7, 2019 publication:
HUD: Reverse mortgages continue drain on FHA insurance fund - HousingWire