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HUD’s NBS Policies and the 14 Words at the Heart of the Debate
Semantics. Words do have meaning and they matter. We can recall the testimony of former President William Jefferson Clinton who famously said “It depends upon what the meaning of the word ‘is’ is” Is your head spinning yet?
As industry watchdog and consumer advocate Atare Agbamu puts it “Fourteen words”. At the heart of the non-borrowing spouse debate and subsequent lawsuits brought against HUD are fourteen words found in the original regulations of the HECM program as part of the National Housing Act in subsection J entitled “Safeguard to prevent displacement of homeowner” which reads “The Secretary may not insure a home equity conversion mortgage under this section unless such mortgage provides that the homeowner’s obligation to satisfy the loan obligation is deferred until the homeowner’s death, the sale of the home, or the occurrence of other events specified in regulations of the secretary. For the purposes of this subsection, the term ‘homeowner’ includes the spouse of a homeowner”.
Seems pretty cut and dried? Well, unfortunately not so. A literal and straight forward…
Download a transcript of this episode here.
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