The 2010 reverse mortgage guidance is designed to help financial institutions ensure that their risk management and consumer financial protection practices adequately address the compliance and reputation risks raised by reverse mortgage lending. The guidance discusses the general features of reverse mortgage products, relevant legal requirements, and consumer financial protection concerns raised by reverse mortgages. The guidance focuses on the need for banks, thrifts, and credit unions to provide clear and balanced information to consumers about the risks and benefits of these products.
Both proprietary products and HECMs are subject to various laws governing mortgage lending including the Federal Trade Commission Act, RESPA, TILA, and fair lending laws. HECMs are also subject to an extensive regulatory regime established by HUD, including provisions for FHA insurance of HECM loans that protect both lenders and reverse mortgage borrowers. The guidance supplements those requirements by advising lenders about additional practices that should be implemented to manage the risks associated with reverse mortgage products.
In August 2010, the Federal Financial Institutions Examination Council (FFIEC), on behalf of its member agencies, published a Federal Register notice adopting supervisory guidance titled âReverse Mortgage Products: Guidance for Managing Compliance and Reputation Risks.â The guidance is designed to help financial institutions with risk management and assist financial institutionsâ efforts to ensure that their reverse mortgage lending practices adequately address consumer compliance and reputation risks.
The reverse mortgage guidance discusses the reporting, recordkeeping, and disclosures required by federal laws and regulations and also discusses consumer disclosures that financial institutions typically provide as a standard business practice. Certain portions of the guidance are âinformation collectionsâ subject to the PRAâs requirements.
US Code:
12 USC 625
Name of Law: Federal Reserve Act
US Code:
12 USC 248
Name of Law: Federal Reserve Act
US Code:
12 USC 1844
Name of Law: Bank Holding Company Act
US Code:
12 USC 3106
Name of Law: International Banking Act
US Code:
12 USC 3105(c)
Name of Law: International Banking Act
US Code:
12 USC 1467a
Name of Law: Home Owners' Loan Act
On behalf of this Federal agency, I certify that the collection of information encompassed by this request complies with 5 CFR 1320.9 and the related provisions of 5 CFR 1320.8(b)(3).
The following is a summary of the topics, regarding the proposed collection of information, that the certification covers:
(i) Why the information is being collected;
(ii) Use of information;
(iii) Burden estimate;
(iv) Nature of response (voluntary, required for a benefit, or mandatory);
(v) Nature and extent of confidentiality; and
(vi) Need to display currently valid OMB control number;
If you are unable to certify compliance with any of these provisions, identify the item by leaving the box unchecked and explain the reason in the Supporting Statement.
FR 4029 83C.pdf
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