110 HR 5758 IH: Reverse Mortgage Proceeds Protection U.S. House of Representatives 2008-04-10 text/xml EN Pursuant to Title 17 Section 105 of the United States Code, this file is not subject to copyright protection and is in the public domain.

I 110th CONGRESS 2d Session H. R. 5758 IN THE HOUSE OF REPRESENTATIVES April 10, 2008 Ms. Lee introduced the following bill; which was referred to the Committee on Financial Services A BILL To prohibit authorized lenders of home equity conversion mortgages from requiring seniors to purchase an annuity with the proceeds of a reverse mortgage, and to provide other consumer protections to reverse mortgage borrowers, and for other purposes.

1.

Short title

This Act may be cited as the Reverse Mortgage Proceeds Protection Act.

2.

Prohibition on required purchase of an annuity

Section 255 of the National Housing Act of 1937 (12 U.S.C. 1715z–20) is amended— (1)by striking subparagraph (B) of subsection (d)(2) and inserting the following new subparagraph: (B)has received adequate counseling by a third party (other than a reverse mortgage lender, servicer or investor, or an entity engaged in the sale of annuities, investments, long-term care insurance, or any other type of financial or insurance product) as provided in subsection (f); ; (2)by striking the first sentence of subsection (f) and inserting the following new sentence: The Secretary shall provide or cause to be provided and paid for by entities other than a reverse mortgage lender, servicer or investor, or an entity engaged in the sale of annuities, investments, long-term care insurance, or any other type of financial or insurance product the information required in subsection (d)(2)(B).; (3)by striking subsection (l); (4)by redesignating subsection (m) as subsection (l); (5)by striking subsection (l), as so redesignated, and inserting the following new subsection: (l)

Funding for counseling

The Secretary may, in his or her discretion, use a portion of the mortgage insurance premiums collected under the program under this section to adequately fund the counseling and disclosure activities required under subsection (f), including counseling for those homeowners who elect not to take out a home equity conversion mortgage. ; and (6)by adding at the end the following new subsection: (m)

Regulations To protect elderly homeowners

(1)

In general

Not later than 6 months after the date of the enactment of the Reverse Mortgage Proceeds Protection Act, the Secretary shall, in consultation with other relevant Federal departments and agencies, prescribe regulations to help protect elderly homeowners from the marketing of financial and insurance products not in the interest of such homeowners, including the marketing or sale of an annuity as a condition of obtaining any home equity conversion mortgage. (2)

Consultation

In developing the regulations required under paragraph (1), the Secretary shall consult with consumer advocates (including recognized experts in consumer protection), industry representatives, representatives of counseling organizations, and other interested parties. .