An Open Letter to America’s Seniors from the National Reverse Mortgage Lenders Association


To America’s Seniors and Their Families:

Last week, the Consumer Financial Protection Bureau released a report highlighting the confusion many consumers have about reverse mortgages.

WASHINGTON, D.C. – July 9, 2012 – (RealEstateRama) — “Because reverse mortgages can help older homeowners ease the strain of retirement, this product can be beneficial if seniors choose it based on a solid understanding of how it works,” CFPB Director Richard Cordray said. He added, however, that many seniors “struggle greatly to understand this complicated product and the tradeoffs involved.”

Through our ongoing public education efforts, the National Reverse Mortgage Lenders Association is aggressively trying to help seniors avoid short-sighted or misinformed choices.  We share the CFPB’s concern that seniors and their adult children need a more in-depth understanding of reverse mortgages. 

To address that issue, NRMLA has developed a series of tools to help seniors better understand the facts about reverse mortgages before they choose to use this complex financial product.

In order to provide straightforward and easy-to-understand information, NRMLA has worked with key stakeholders over the past year to develop a comprehensive public education effort called Borrow with Confidence

The members of the National Reverse Mortgage Lenders Association agree that a reverse mortgage is not the right choice for everyone. It is a significant financial and emotional decision about a complex product.  Borrow with Confidence provides the facts so consumers have a clear understanding of the reverse mortgage process.

Consumers may find Borrow with Confidence at or they may request a booklet by calling (866) 264-4466.

It clearly explains the reverse mortgage product, application process, fees, qualification criteria, borrower responsibilities, the potential risks and offers advice for adult children of borrowers. There is also a glossary of terms, answers to frequently asked questions, and the truth about many common misperceptions about reverse mortgages.

Potential borrowers are encouraged to ask their own questions – either via the Website or a toll-free telephone number – about any aspect of reverse mortgages that they find confusing.

Additionally, Borrow with Confidence includes a 19-point pledge to borrowers that clearly explains borrowers’ rights and confirms the high level of integrity they should expect. NRMLA members are bound by a strict code of ethics, which, among other things, clearly forbids “false or misleading or deceptive or unfair communications or advertisements.” 

The National Reverse Mortgage Lenders Association wants consumers to have the resources they need to make informed and deliberate decisions about their retirement security.  We want them to borrow with the confidence that they know the facts.  We want them to borrow with confidence because they know what to expect.

Clear and honest information can help seniors and their families make the best decisions for their own situations.  The National Reverse Mortgage Lenders Association will continue to work with the CFPB to achieve that goal.

Sincerely Yours,

Peter H. Bell
President & CEO                                                                                

About Reverse Mortgages

Reverse Mortgages are available to seniors 62 years old and older with significant home equity. They are designed to enable elderly homeowners to borrow against the equity in their homes without having to make monthly payments as is required with a traditional “forward” mortgage or home equity loan. Under a reverse mortgage, funds are advanced to the borrower and interest accrues, but the outstanding balance is not due until the last borrower leaves the home, sells or passes away. Borrowers may draw down funds as a lump sum at loan origination, establish a line of credit or request fixed monthly payments for as long as they continue to live in the home.  To date, more than 750,000 senior households have utilized an FHA-insured reverse mortgage.

About the National Reverse Mortgage Lenders Association

The National Reverse Mortgage Lenders Association (NRMLA) is a membership organization comprised of more than 300 companies and more than 1,000 people participating in the reverse mortgage industry.  With a membership responsible for more than 90 percent of reverse mortgage transactions in the United States, NRMLA serves as the national voice for the industry.  It serves as an educational resource, policy advocate and public affairs center for lenders and related professionals. NRMLA was established in 1997 to enhance the professionalism of the reverse mortgage business.  All NRMLA member companies commit themselves to our Code of Ethics & Professional Responsibility.

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