Ginnie Mae announced today that it would start securitizing reverse mortgages by creating the Home Equity Conversion Mortgage MBS (HECM MBS). The announcement was made at press conference hosted by the Agency.
Reverse mortgages offer homeowners the chance to convert the equity in their homes to monthly lines of credit. With this mortgage, homeowners above 62 years old could receive payments in a lump sum, attain a line of credit or monthly payment. The loan only becomes due when the last borrower moves out, dies or sells the home.