JOINT FAVORABLE REPORT
AN ACT CONCERNING PROTECTIONS FOR CONSUMERS APPLYING FOR REVERSE MORTGAGES.
Disclaimer: The following JOINT FAVORABLE Report is prepared for the benefit of the members of the General Assembly, solely for purposes of information, summarization and explanation and does not represent the intent of the General Assembly or either chamber thereof for any purpose.
SPONSORS OF BILL:
REASONS FOR BILL:
Current law does not provide adequate protections for consumers applying for reverse mortgages. This bill provides additional consumer protections during the application process for reverse mortgages.
RESPONSE FROM ADMINISTRATION/AGENCY:
None expressed (in response to SB 395).
NATURE AND SOURCES OF SUPPORT:
Martin M. Looney, State Senator – 11th District
Senator Looney expressed support for the bill, and stated that it will provide much needed protection of elder constituents. This will protect constituents from unscrupulous reverse mortgage companies that do not disclose the possible bad outcomes of taking the loan.
Mary Mushinsky, State Representative – 85th District
Representative Mushinsky expressed support for the bill, citing the malpractices of some reverse mortgage companies, resulting in extremely unfavorable consequences for homeowners. She conceded that most of the most egregious abuses were fixed by new HUD regulations, but CT is one of only 11 states without any law concerning reverse mortgages. She urged that the committee move to implement this legislation.
NATURE AND SOURCES OF OPPOSITION:
Kelly Ramsey Fuhlbrigge, Vice President - Government Relations – Credit Union League of Connecticut
The Credit Union League of Connecticut opposed the bill, and stated that it unfairly targets CT credit unions and banks, as other companies operating outside the state would not be subject to the law. Kelly Fuhlbrigge cited that the Mortgage Brokers Association, which provided information claiming 99% of CT reverse mortgages are Federal Housing Administration- insured home equity conversion mortgages, which already have counseling requirements with HUD. She also claimed that the bill would make it harder for senior citizens to obtain reverse mortgages from reliable sources.
Reported by: Sara LeMaster