Indy Standard

WASHINGTON—U.S. Senator Mike Braun has taken action by sending a letter to Alanna McCargo, the Acting President of the Government National Mortgage Association ("Ginnie Mae"), to address the challenges arising in HUD's Home Equity Conversion Mortgage Program. The program, commonly known as the reverse mortgage program, has faced difficulties due to the bankruptcy of a key company, prompting concerns about the financial security of seniors.

Senator Braun, in his letter, expressed his concerns about the impact of recent failures on older homeowners, stating, "Reverse mortgages can be a lifeline for older homeowners needing access to cash during retirement, and recent failures threaten the financial security for hundreds of thousands of seniors." He emphasized the importance of addressing mismanagement to prevent potential harm to both seniors and taxpayers.

Highlighting the need for stability and viability in the reverse mortgage market, Senator Braun requested additional information about proposed policy solutions to safeguard the program moving forward. He referenced the bankruptcy of "Reverse Mortgage Funding" (RMF) as a specific cause for concern and urged proactive measures to prevent further disruptions in the market.

Furthermore, Senator Braun pointed to a report by the Government Accountability Office (GAO) from November 2019, which raised issues related to risk management at Ginnie Mae. The report highlighted staffing problems and oversight shortcomings, offering recommendations to address these concerns and prevent similar incidents that could contribute to company bankruptcies like RMF's in November 2022.

The letter sent by Senator Braun builds on an investigation initiated by the Housing and Urban Development’s Office of Inspector General, reflecting a concerted effort to address the challenges facing the Home Equity Conversion Mortgage Program and ensure the protection of seniors relying on reverse mortgages for financial stability.