Department of Housing and Urban Development Secretary Ben Carson believes that the changes made to the reverse mortgage program in October 2017 are helping to remedy the product, according to a new report.
“I think it has largely stemmed the tide in terms of the disaster that was occurring there,” Carson said during testimony before the House Appropriations Subcommittee on Transportation, Housing, and Urban Development, according Reverse Mortgage Daily.
“But we were draining from the MMIF $12.5 billion over a nine-year period. That was ridiculous.”
The secretary was in the hot seat with questions coming from Rep. Mario Diaz-Balart and according to the report, the Florida representative was prepared with statistics that pointed towards and increase in reverse mortgage foreclosure and defaults.
When, Diaz-Balart expressed his concerns over the current state of the reverse mortgage program, Carson replied by saying his team had "inherited a mess," according to the report. Though, the secretary did say that he believed he and his team were dealing with the issues in the reverse mortgage program "effectively."
"HUD officials specifically cited the drains on the MMI Fund when introducing lower principal limit factors and updated mortgage insurance premiums last fall," according to RMD.
"At the time, the most recent actuarial report showed that the HECM program had an economic value of negative $7.7 billion; later in the year, the fiscal 2017 report showed that number had ballooned to negative $14.5 billion."
To learn more about Secretary Carson's most recent statements regarding the current state of the reverse mortgage program, click on the image above.