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Korea’s Reverse Mortgage Program Raises Questions


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South Korea Now Actively Promoting Reverse Mortgages

reverse mortgageThe Korean Financial Services Commission announced last month that they will introduce a new set of policies in the effort to spur reverse mortgage adoption to help the elderly prepare for retirement.  Facing a rapidly expanding aging population and fewer prepared retirees the South Korean government has taken proactive steps to promote reverse mortgages while seeking to change the perception that the home is an asset to be passed on versus a pension product. The question is why doesn’t the U.S. government do the same?

Eighty-one percent of assets held by those 60 and older are held in homes or residential real estate. Sound familiar? It should. South Korean’s face similar challenges found in the United States with more pre-retirees unprepared or underprepared to fund their non-working years. Here’s just one example.

Download a transcript of this episode here.

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  1. “The question is why doesn’t the U.S. government do the same?” The answer is that privately-owned reverse mortgage companies can do a better job of marketing reverse mortgages. Do we really want HUD doing industry marketing?

  2. If it wasn’t next to the Coooocko to the north,
    South Korea might be a good place to go ,
    The U. S. could help with out actually marketing.
    Like cutting some of Oregon’s funds. like Oregon
    is doing to the seniors by not giving them the tax
    break that other states do. In a lot of states it is called the Circuit Breaker.

  3. Atare,

    Having HUD separately promoting HECMs would add credibility to lender promotions. Yet part of the problem is that HUD does not provide any significant safeguards for borrowers beyond those found in the lender loan approval process and the loan documents.

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