Minnesota Lawmakers Target Reverse Mortgages
The Attorney General of Minnesota, Lori Swanson, has sought to bring reverse mortgage protection to Minnesotan seniors. The new legislation proposed to be made will allow home owner seniors to rescind a reverse mortgage agreement, within a period of 30 days from the date of signing the agreement. The new legislation would also make it compulsory for seniors who seek a reverse mortgage on their homes to get some independent counseling about the risks and benefits of the reverse mortgage loan.
The reasoning made out by Minnesota law makers for making this proposal is that a small number of unscrupulous lenders are seen to be abusing seniors who want some cash from their homes fast.
Swanson said that some American seniors are persuaded into making reverse mortgage decisions, which can come with high interest rates and agent fees. And she also felt that some lenders are trying to get the seniors to take a reverse mortgage loan and use the resulting money for making investments.
Attorney General Lori Swanson and Minnesotan legislative leaders have called for more consumer protection for seniors considering a reverse mortgage. Minnesota Reverse mortgages are financial agreements that allow people aged 62 or above to convert home equity to quick cash. The majority of these reverse mortgage loans are made in the form of a federally insured financial instrument known as a Home Equity Conversion Mortgage (HECM). Those reverse mortgages have consumer protections that are built-in as a standard feature. Lori Swanson said that those features need to be extended to seniors being courted by new reverse mortgage lenders.
It is always best to go for established mortgage lenders, when as a senior you are seeking to convert some or all of your home equity to cash. Established mortgage lenders who have been in business for several years take all care to advise you whether a reverse mortgage would be good for you and whether you would be able to meet your cash requirements, etc.
The state of Minnesota has gone one step further in protecting the interest of tax-paying American seniors by proposing this new legislation. This can help protect the legitimate financial interests of Minnesotan seniors.
