14 April 2013

Reverse Thrusters, Mr. Scott!

A comment on one of these missives, posted in an alternative universe, led me to comment serially. This is the part of the comment which motivated this missive:
The only way to increase the demand for stick built single family housing is to drop the price a lot. Not to mention that boomers will be dieing off soon, and all those reverse mortgages will stuff yet more inventory into the mix.

Which led me to go a lookin' for data on reverse mortgages by year and value. Haven't found same as yet, but I did find a bit scary reporting from last week.
While forward mortgages show a surplus in FHA's reestimate of reserves of $4.3 billion, the reverse mortgage portion shows a loss of $5.2 billion, resulting in the $943 million shortfall, according to FHA.

An actuarial review of the MMI fund in late 2012 indicated the reverse mortgage fund had a negative $2.8 billion economic value; part of more than $16 billion in negative economic value of the fund overall.

There have been a stream of stories about surviving spouses being tossed out of homes when the mortgage holder spouse kicks the bucket; the rules about who can be on the title/deed get convoluted. And, according to some reports, such as this, the Banksters aren't above fibbing a bit.

I wonder: is there yet another Viagra at the home we need to worry about?

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