Hello from San Diego! The MBA Reverse Mortgage Conference is under way. Live tweets can be found at www.twitter.com/hecmgirl. The conference has been incredibly interesting so far, featuring a wide variety of participants. This morning’s highlights included previews of new FHA programs and protocols (more to come on this later) and a very interesting exchange regarding reverse mortgage defaults.
The number 1 reason a reverse mortgage “defaults” is the death of the last borrower on the reverse mortgage loan, but default in this context means the loan becomes due and payable (in accordance with the loan contract). However, another large issue regarding defaults are defaults due to the failure to pay title and insurance. While servicers will do so in order to keep the asset (the home), the loan will become due by the borrower if they don’t pay title and insurance. This is an area where many in the industry see potential for improvement.
I wish I had time to write more, but the afternoon sessions are about to begin. More to come later!