The Government’s Redesigned Reverse Mortgage Program


The brief’s key findings are:

  • Reverse mortgages, which allow retirees to tap their home equity, are insured by the government.
  • The financial crisis hurt both the government’s insurance fund and the borrowers.
    • Declining home prices led to losses when homes were sold.
    • More borrowers defaulted.
  • In response, the government has redesigned the program by:
    • creating a single loan option with a lower limit and fees;
    • limiting initial withdrawals; and
    • requiring financial assessments of borrowers.
  • These changes should help reduce pressure on the insurance fund and make defaults less likely.

The CRR wants to hear from our website users like you. Would be you willing to take a short survey?

Yes, take me to it.       No, thanks.      Not now, but ask me later.