A “Kosher” Reverse Loan?

I found this summary of an article that was published by Jack Guttentag, otherwise known at the Mortgage Professor, to be amusing.   It certainly is an interesting suggestion to “certify” Reverse mortgages in a way to make it easier to navigate the myths and realities of how they function and sort the truth from the ignorance.

He may be on to something and I’m going to share is point of view on this intriguing idea he discussed in the following article.

Mortgage Prof.: ‘Kosher’ Reverse Mortgages Would Simplify Product

Posted By Emily Study On October 19, 2014 @ 5:32 pm In Commentary,HECM,News,Reverse Mortgage | No Comments

“In the complex world of home equity conversion mortgages (HECMs), a certification process would make it easier for seniors to navigate these financial products, writes [1] Jack Guttentag, of The Mortgage Professor.

And the best way to do so? Label them “kosher.”

The kosher stamp on food means that it has been certified as fit for human consumption, satisfying the requirements of Jewish law. Similarly, a kosher HECM — which does not yet exist, but will soon, Guttentag suggests — would indicate the financial instrument is safe for consumers.

Reverse mortgages have long been associated with “horror stories” reported by the media. But since significant reverse mortgage program changes, the product has received nods [2] from many in the financial planning community, along with the media [3].

Still, a kosher HECM, in addition to kosher HECM loan advisers and systems, would provide a clear picture of what the product is — with no surprises. ”

I will provide the rest of the article in a following post.

However, if reading this causes a few laughs and comments, please share your thoughts.   Or just contact me.

 

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