Reverse mortgage lenders could see loan volumes drop 20% this year as the Federal Housing Administration implements the last of a series of reforms to its Home Equity Conversion Mortgage program.

Lenders are waiting with “bated breath” for FHA to release its final rules, which will require financial assessments for the first time, according to industry consultant Jeffrey Taylor. The new rules will require lenders to determine if the senior has the income or financial resources to pay their property taxes and homeowners insurance once they take out a FHA-insured HECM loan.

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