Tuesday, January 23, 2018
Editorials

Editorial: Floridians vulnerable on reverse mortgages

When financial instruments are backed by government money, regulators have twin obligations to make sure they are sound: to protect consumers and taxpayers' liability. When it comes to reverse mortgages, those protections appear lacking on both fronts, leaving too many Floridians vulnerable to overzealous pitches and taxpayers too often picking up the tab. It's time for the federal government to get serious about ensuring that homeowners know all the risks when they sign up for a reverse mortgage.

At the onset, reverse mortgages may seem like a simple, quick fix to money problems. But in reality they are complex deals that could leave homeowners owing more than their home is worth or facing foreclosure.

The Tampa Bay Times' Susan Taylor Martin reported last Sunday that reverse mortgages peaked in 2009 at nearly 115,000 as homeowners struggled during the recession. Touted by pitchmen such as actors Henry Winkler and Fred Thompson, the mortgages allow homeowners 62 and older to cash in their house's equity and stop making monthly payments. Upon death, homeowners' heirs can sell the house, pay off the reverse mortgage and keep any remaining money. If they cannot repay, the federal government picks up the tab. Borrowers risk default and foreclosure if they move or fail to pay property taxes or insurance.

The federal government requires credit counseling for potential borrowers before it approves a reverse mortgage. But large numbers of defaults in the Tampa Bay area alone suggest that tactic has done little to protect homeowners. Fran and Kenny Goodnow of St. Petersburg are a textbook example of what can happen when reverse mortgages go wrong. The couple bought their Kenwood home in 1989 for $40,000. After refinancing their home years earlier, the couple entered into a reverse mortgage agreement with James B. Nutter & Co. The company paid off the couple's $153,700 existing mortgage. When the Goodnows missed several insurance payments, the lender demanded they repay $217,000. In ill health and unable to pay, the couple, ages 71 and 87, must leave their home by July 25. Although they met with a credit counselor prior to obtaining a reverse mortgage, the Goodnows say they did not understand their obligation. Sadly, their story mirrors that of thousands of Floridans and other seniors nationwide.

Reverse mortgages can benefit seniors in need, but they are rife with potential pitfalls. They are best utilized by people who fully understand the risks and have the ability to be able to keep up with property tax and insurance payments. Young borrowers, those who plan to move soon or with uncertain income in the future are not good candidates. The government needs to ensure those messages are getting delivered because frankly, it's not in the lender's interest to do so.

When a borrower defaults on a reverse mortgage, lenders get repaid by the federal government, which ultimately passes the cost to taxpayers. That's a breeding ground for exploitation. Lenders must be required to be transparent and government needs to make sure that translates into borrowers fully understanding that what folksy pitchmen bill as a safe, financial windfall could actually be a cyclone if they are unprepared.

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Editorial: A good first step in restoring the right to vote

Editorial: A good first step in restoring the right to vote

Allowing felons a meaningful chance to reclaim their right to vote and rejoin civic life is edging closer to reality in Florida. On Tuesday the state announced that a yearslong petition drive to put a constitutional amendment on the November ballot h...
Updated: 3 hours ago
Editorial: Look hard into Tampa Bay and Pinellas CareerSource CEO, and get to the bottom of the numbers and the money

Editorial: Look hard into Tampa Bay and Pinellas CareerSource CEO, and get to the bottom of the numbers and the money

Something is seriously amiss at Tampa Bay’s two CareerSource agencies, which receive millions in federal and state money to match unemployed workers with local employers. First, the agencies appear to be taking credit — and money — for job placements...
Published: 01/22/18

A Chicago Tribune editorial: Shut down this shutdown habit

"Shutting down the government of the United States of America should never ever be a bargaining chip for any issue. Period. It should be to governing as chemical warfare is to real warfare. It should be banned."— Lamar Alexander, R-Tenn., addressing ...
Published: 01/22/18
Editorial: Beware of social media targeting kids

Editorial: Beware of social media targeting kids

Ignoring all available evidence that screen time and social media exposure can be harmful to kids, Facebook recently unveiled a new messaging app targeting children under 13. It’s yet another battlefront for parents who have to constantly combat the ...
Published: 01/21/18
Editorial: Too soon for Tampa Bay to settle for buses over light rail

Editorial: Too soon for Tampa Bay to settle for buses over light rail

The good news on the transportation front is that Tampa Bay’s government and business leaders are working together like never before to connect the region’s largest cities, attractions and employment centers with a more robust mass transit system. Th...
Published: 01/20/18
Editorial: Saying ‘thank you’ helps Tampa police build needed trust

Editorial: Saying ‘thank you’ helps Tampa police build needed trust

The smiles, applause and at least one hug belied the grim impetus for a gathering last week at a neighborhood center in Tampa — the Seminole Heights killings.The Tampa Police Department held a ceremony to thank those who helped in the investigation t...
Published: 01/19/18
Updated: 01/21/18
Editorial: Criminal charges should finally wake up FSU fraternities to hazing’s dangers

Editorial: Criminal charges should finally wake up FSU fraternities to hazing’s dangers

The death last fall of a 20-year-old Florida State University fraternity pledge revealed pervasive dangerous behavior within the school’s Greek system. Andrew Coffey, a Pi Kappa Phi pledge, died from alcohol poisoning after an off-campus party, and a...
Published: 01/19/18

Editorial: Confronting racial distrust in St. Petersburg, one conversation at a time

The St. Petersburg Police Department’s heavy presence in Midtown on Martin Luther King Jr. Day and the community animosity it stirred have raised a familiar, troubling question: Can St. Petersburg’s racial divisions ever be reconciled?That big ideal ...
Published: 01/19/18
William March: Tampa Bay Democrats line up for state legislative races

William March: Tampa Bay Democrats line up for state legislative races

A surge of Democrats seeking local legislative offices and hoping for a "blue wave" in the 2018 election continued last week, led by Bob Buesing filing to run again versus state Sen. Dana Young, R-Tampa.In addition:• Heather Kenyon Stahl of Tampa has...
Published: 01/19/18

Editorial: State’s warning shot should get attention of Hillsborough schools

The state Board of Education hopefully sent the message this week with its warning shot about the slow pace of the turnaround at Hillsborough County’s low-performing schools.The board criticized the school system for failing to replace administrators...
Published: 01/18/18
Updated: 01/19/18