Reverse Mortgage Could See Higher Premiums

As reported by the WSJ,  Housing and Urban Development Secretary Shaun Donovan said Thursday that the government could raise insurance premiums for government-backed reverse mortgages in order to avoid a $798 million taxpayer infusion for the program.

As this WSJ story noted on Wednesday, the Federal Housing Administration is asking for taxpayer money for the first time in the 20-year history of the program given deteriorating home values. Reverse mortgages allow seniors to take money out of their homes, and government-backed loans, called Home Equity Conversion Mortgages, or HECM, insure lenders against losses if the home is worth less than the value of the loan when the property is sold.

Keep reading->