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Jens 'n' Frens |
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If you're not aware of enough insane regulations, take a look at reverse mortgages:One problem is that lenders are not allowed to set aside payments for property taxes and other such recurring costs, leading to trouble if the borrower cannot pay them. Contributing to the issue is a prohibition on underwriting loans based on borrowers' credit rather than the equity they have in their home.I could just imagine — well, let's pretend — that one of these might in some circumstance turn out to be a bad idea, but a blanket prohibition? Wells Fargo, asked by the government to foreclose on elderly customers, is exiting the business:"The last straw in our decision was the recent HUD decision to require servicers to initiate foreclosure on the Senior Reverse Mortgage customers [who] could not pay their taxes and insurance," the email [from "a Wells executive" to "business contacts"] said. "When a product or program creates more reputation risk than value … well … you get the picture."On sort of a similar note, The European Court of Justice [sic] has decided that insurance companies can't base rates on the customer's sex, even where it's clearly relevant.Article 5(2) of Directive 2004/113 allows the differences between males and females to be used in determining risk factors on insurance contracts. |
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