A proposed bill in California aiming to require lenders to manage homeowner expenses through escrow accounts for reverse mortgages was withdrawn by its sponsor, State Senator Nick Charles. The National Reverse Mortgage Lenders Association (NRMLA) opposed the legislation, citing concerns over its potential disruption to the state's reverse mortgage market. They warned it could impose interest on unutilized borrower funds and conflict with existing federal guidelines. After discussions with NRMLA, it became clear the bill would not proceed. The senator indicated ongoing communication with the affected constituent and industry regarding potential future solutions.
The bill aimed to mandate lenders to use escrow accounts for expenses in reverse mortgages but was withdrawn due to opposition from the National Reverse Mortgage Lenders Association.
State Senator Nick Charles withdrew the bill after realizing it might conflict with federal reverse mortgage program requirements as outlined by the National Reverse Mortgage Lenders Association.
The intent behind the bill was to address complaints from constituents regarding unexpected fees in the HECM origination process, but opposition led to its withdrawal.
Despite withdrawing the bill, Charles's office is committed to continuing discussions with the constituent and the NRMLA to explore potential solutions.
#reverse-mortgages #legislation #escrow-accounts #national-reverse-mortgage-lenders-association #california
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