In what regulators have described as the second-largest bank failure in the history of the United States, IndyMac Bank has been seized by Federal Deposit Insurance Corporation (FDIC) due to plummeting shares and the start of a run on the bank. This is the fifth FDIC-insured failure of the year.

There is another side to this story that affects senior borrowers very deeply that must be considered and needs to be brought out. IndyMac Bank owns Financial Freedom and holds one of the largest portfolios of both government insured Home Equity Conversion Mortgages...