Reverse Mortgage Products Guidance for Managing Compliance and Reputation Risks

Forms and Documents

Document Name	Status
FR 4029_201505_83c.pdf Justification for No Material/Nonsubstantive Change	2015-05-28

IC Document Collections

IC ID	Document Title	Status
192773	Policy & Procedures (On-going) Other-Guidance	Modified
192772	Policy & Procedures (implementation) Other-Guidance	Modified

ICR Details

OMB Control No: 7100-0330	ICR Reference No: 201505-7100-007
Status: Historical Active	Previous ICR Reference No: 201004-7100-009
Agency/Subagency: FRS	Agency Tracking No: FR 4029
Title: Reverse Mortgage Products Guidance for Managing Compliance and Reputation Risks
Type of Information Collection: No material or nonsubstantive change to a currently approved collection	Common Form ICR:  No
Type of Review Request: Delegated
OIRA Conclusion Action: Approved without change	Conclusion Date: 06/05/2015
	Date Received in OIRA: 06/05/2015
Terms of Clearance:

	Inventory as of this Action	Requested	Previously Approved
Expiration Date	09/30/2015	09/30/2015	09/30/2015
Responses	34	0	36
Time Burden (Hours)	816	0	864
Cost Burden (Dollars)	0	0	0

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Abstract: Reverse mortgages enable eligible borrowers to remain in their homes while accessing their home equity in order to meet emergency needs, supplement their incomes, or, in some cases, purchase a new home – without subjecting borrowers to ongoing repayment obligations during the life of the loan. The use of reverse mortgages could expand significantly in coming years as the U.S. population ages and more homeowners become eligible for reverse mortgage products. If prudently underwritten and used appropriately, these products have the potential to become an increasingly important product for addressing certain credit needs of an aging population. Reverse mortgages present substantial risks both to financial institutions and to consumers and, as with any type of home-secured loan, it is crucial that consumers understand the product terms and the nature of their obligations. In addition to consumer financial protection concerns that raise corresponding financial institution compliance and reputation risks, reverse mortgage products may present other risks, such as credit, interest rate, and liquidity risks, especially for proprietary reverse mortgage products lacking the insurance offered under the federal HECM program. The 2010 reverse mortgages 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.

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Authorizing Statute(s): US Code: 5 USC 552(b)(8) & 552(b)(4) Name of Law: Freedom of Information Act
  

Citations for New Statutory Requirements: None

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Associated Rulemaking Information
RIN:	Stage of Rulemaking:	Federal Register Citation:	Date:
	Not associated with rulemaking

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Federal Register Notices & Comments
60-day Notice:	Federal Register Citation:	Citation Date:
	74 FR 66652	12/16/2009
30-day Notice:	Federal Register Citation:	Citation Date:
	75 FR 50801	08/17/2010
Did the Agency receive public comments on this ICR? No

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Number of Information Collection (IC) in this ICR: 2

IC Title	Form No.	Form Name
Policy & Procedures (On-going)
Policy & Procedures (implementation)

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ICR Summary of Burden

	Total Approved	Previously Approved	Change Due to New Statute	Change Due to Agency Discretion	Change Due to Adjustment in Estimate	Change Due to Potential Violation of the PRA
Annual Number of Responses	34	36	0	0	-2	0
Annual Time Burden (Hours)	816	864	0	0	-48	0
Annual Cost Burden (Dollars)	0	0	0	0	0	0

Burden increases because of Program Change due to Agency Discretion: No

Burden Increase Due to:

Burden decreases because of Program Change due to Agency Discretion: No

Burden Reduction Due to:

Short Statement: Decrease in burden reflects decrease in the respondent panel.

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Annual Cost to Federal Government: $0

Does this IC contain surveys, censuses, or employ statistical methods? No

Is the Supporting Statement intended to be a Privacy Impact Assessment required by the E-Government Act of 2002? No

Is this ICR related to the Affordable Care Act [Pub. L. 111-148 & 111-152]? No

Is this ICR related to the Dodd-Frank Wall Street Reform and Consumer Protection Act, [Pub. L. 111-203]? No

Is this ICR related to the American Recovery and Reinvestment Act of 2009 (ARRA)? No

Is this ICR related to the Pandemic Response? Uncollected

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Common Form ICR:  No

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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:

(a) It is necessary for the proper performance of agency functions;

(b) It avoids unnecessary duplication;

(c) It reduces burden on small entities;

(d) It uses plain, coherent, and unambiguous language that is understandable to respondents;

(e) Its implementation will be consistent and compatible with current reporting and recordkeeping practices;

(f) It indicates the retention periods for recordkeeping requirements;

(g) It informs respondents of the information called for under 5 CFR 1320.8 (b)(3) about:

(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;

(h) It was developed by an office that has planned and allocated resources for the efficient and effective management and use of the information to be collected.

(i) It uses effective and efficient statistical survey methodology (if applicable); and

(j) It makes appropriate use of information technology.

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.

Certification Date: 06/05/2015

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