Tennessee House Bill HB2382

Tennessee 2025-2026 Regular Session

• Introduced: 2/2/26
• Refer: 2/5/26
• Refer: 3/4/26
• Refer: 3/11/26
• Engrossed: 3/26/26
• Enrolled: 4/23/26
• Passed: 5/19/26

Caption

AN ACT to amend Tennessee Code Annotated, Title 39, Chapter 15, Part 5; Title 45, Chapter 2, Part 12; Title 45, Chapter 20; Title 47, Chapter 30 and Title 67, Chapter 4, Part 4, relative to reverse mortgages.

Summary

HB2382 updates Tennessee’s reverse mortgage law by renaming the existing “Home Equity Conversion Mortgage Act” as the “Tennessee Reverse Mortgage Innovation Act” and revising statutory definitions and terminology throughout the code. The bill broadens and modernizes the framework for reverse mortgages, clarifying what qualifies as a reverse mortgage loan, requiring clear labeling on loan documents, and expressly recognizing that these loans may be FHA-insured or not FHA-insured so long as they comply with state and federal law. The bill also strengthens consumer-protection provisions. It makes noncompliant reverse mortgage contracts unenforceable as to interest, service fees, and insurance premiums; confirms that reverse mortgages are non-recourse loans; and requires lenders to obtain certification that borrowers and necessary participants received independent counseling before closing. It adds a new prohibition on cross-selling, barring lenders from requiring or soliciting the purchase of annuities, insurance policies, or other financial products as a condition of obtaining a reverse mortgage. In addition to the reverse mortgage chapter itself, HB2382 makes conforming changes across several other Tennessee Code sections that reference reverse mortgages, including provisions in criminal law, financial regulation, and tax law. It also directs the Tennessee Code Commission to update the chapter heading to match the new title. Overall, the bill is a statewide statutory update affecting lenders, borrowers, counselors, and agencies that administer or reference reverse mortgage rules. The general sentiment around the bill appears favorable. It moved through subcommittee and committee with strong support and passed both chambers, though not unanimously, indicating broad agreement on the need to modernize the law while preserving consumer safeguards. The bill’s stated purpose is to expand financial tools for senior homeowners and position Tennessee as a leader in retirement-related financial innovation. The main points of contention appear to center on the balance between flexibility and consumer protection. Supporters emphasized modernization, expanded options for older homeowners, and alignment with national best practices, while the added counseling requirement, enforceability penalties, and anti-cross-selling rule reflect concerns about potential abuse in the reverse mortgage market. The recorded votes show some opposition at each stage, suggesting limited but present concern about the scope of the changes or their regulatory impact.

Impact

HB2382 amends Tennessee’s reverse mortgage statutes in Title 47 and makes related conforming changes in Titles 39, 45, and 67. It replaces the prior “Home Equity Conversion Mortgage Act” terminology with the “Tennessee Reverse Mortgage Innovation Act,” expands the statutory definition of reverse mortgage loans, authorizes non-FHA-insured reverse mortgages if they comply with law, and imposes clearer disclosure, counseling, and anti-cross-selling requirements. It also affects how reverse mortgages are referenced in other parts of the code, including provisions related to criminal law, financial regulation, and tax treatment.

Sentiment

The bill appears to have been generally well received. It advanced with strong committee support and passed both chambers, though with some dissenting votes at each stage. The discussion reflected a broadly pro-modernization and pro-consumer-protection posture, with lawmakers framing the measure as a way to expand options for senior homeowners while maintaining safeguards.

Contention

The principal tension in HB2382 is between expanding the reverse mortgage market and protecting vulnerable borrowers. Supporters favored broader flexibility, updated terminology, and recognition of non-FHA products, while the bill’s safeguards suggest concern about predatory practices, inadequate counseling, and cross-selling of unrelated financial products such as annuities or insurance. The recorded nays indicate that some legislators were not fully comfortable with the changes, likely due to concerns about consumer risk, regulatory looseness, or the effects of removing older program-specific limitations.