Connecticut Seal

General Assembly

 

Raised Bill No. 395

February Session, 2018

 

LCO No. 1596

 

*_____SB00395JUD___042418____*

Referred to Committee on BANKING

 

Introduced by:

 

(BA)

 

AN ACT CONCERNING PROTECTIONS FOR CONSUMERS APPLYING FOR REVERSE MORTGAGES.

Be it enacted by the Senate and House of Representatives in General Assembly convened:

Section 1. (NEW) (Effective October 1, 2018) (a) No entity, including, but not limited to, any Connecticut bank or Connecticut credit union, as defined in section 36a-2 of the general statutes, shall accept a final and complete application for a reverse annuity mortgage loan, as defined in section 36a-265 of the general statutes, or assess any fees for such mortgage, unless such entity has:

(1) (A) Informed the prospective applicant of the counseling requirement in subdivision (2) of this subsection, and (B) provided the prospective applicant with a list of at least five independent housing counseling agencies approved by the United States Department of Housing and Urban Development to engage in reverse annuity mortgage loan counseling, as provided in 24 CFR 206.300 et seq., as amended from time to time. No such counseling agency shall receive any compensation, either directly or indirectly, from the lender or from any other person or entity involved in originating or servicing the loan;

(2) Received a certification signed by (A) the prospective applicant or the prospective applicant's authorized representative, and (B) a counselor from an independent housing counseling agency, as described in subdivision (1) of this subsection, that the applicant has received reverse annuity mortgage loan counseling from such counselor. Such certification shall (i) specify whether the counseling session was conducted in person or by telephone, and (ii) include the date of the counseling session, and the name, address and telephone number of both the applicant and the counselor;

(3) Received a certification of the reverse annuity mortgage loan origination signed by (A) the prospective applicant or the prospective applicant's authorized representative, and (B) the reverse annuity mortgage loan originator. Such certification shall (i) specify whether such origination was conducted in person or by telephone, and (ii) include the date of the loan origination meeting, and the name, address and telephone number of both the prospective applicant and the loan originator; and

(4) Received a certification pursuant to subdivision (2) or (3) of this subsection that indicates either: (A) The reverse annuity mortgage loan counseling session, or (B) the reverse annuity mortgage loan origination was conducted in person.

(b) The lender shall maintain any certification described in subsection (a) of this section in an accurate, reproducible and accessible format for the term of the reverse annuity mortgage loan.

(c) A violation of the provisions of this section shall be deemed an unfair or deceptive act or practice in the conduct of trade or commerce pursuant to subsection (a) of section 42-110b of the general statutes.

This act shall take effect as follows and shall amend the following sections:

Section 1

October 1, 2018

New section

BA

Joint Favorable

 

JUD

Joint Favorable