IN BRIEF: Bill Offered to Extend Reverse Mortgage Plan

WASHINGTON - A bill introduced by Rep. Rick Lazio, R-N.Y., would extend a government program that allows lenders to make reverse mortgages.

The loans, also known as home equity conversion mortgages, allow older homeowners to remain in their homes for life while cashing in equity; the lending institution inherits the house when the homeowner dies.

Currently, the Department of Housing and Urban Development insures such mortgages under its FHA program. The Lazio bill would extend the program's life to Sept. 30, 2000.

It also would expand the program beyond single-family homes to include one- to four-family structures if the owner occupies one of the units.

Rep. Lazio is working on legislation that would be likely to curtail the role of the government housing agency. But in a press release he said he supports the reverse mortgage insurance program.

"This is precisely the kind of role FHA has served well in the past and should continue to serve into the future," Rep. Lazio said, "creating a market for valuable financing products and, after they are established, moving out to let the private sector operate those products more efficiently."

For reprint and licensing requests for this article, click here.
MORE FROM AMERICAN BANKER