The expectations of older homeowners when willing their home to their children is often an illusion.
Continue readingHave decades of HECM reforms worked?
Have decades of HECM reforms had their desired effect? We examine key HECM policy changes, their impact, and effectiveness.
Continue readingMajor Changes to HECM Applications?
HECM Regional Limits? A look at HUD’s Legislative Requests
FHA’s proposed HECM policy changes: What you need to know
Here are the key proposed policy changes for the HECM that every reverse mortgage originator should understand and communicate with borrowers who may find themselves in these specific situations.
Continue readingHECM public perception, policy & property values
Part 2 of our exclusive interview with Dan Hultquist examines the impacts of public perception, policy, and property values on the HECM program.
Continue readingReforms may hinge on Actuarial Report
Despite improvements, Secretary Carson pushes for 3 key changes
While we’ve seen no official mortgagee letter or Congressional action on recently-proposed reforms to the Home Equity Conversion Mortgage- some key changes were restated last week in HUD Secretary Ben Carson’s written remarks to the House Financial Services Committee. Legislative proposals such as the elimination of a national lending limit and the removal of the HECM from FHA’s Mutual Mortgage Insurance Fund may hinge on next month’s Actuarial report to Congress. The report details the financial health of the program. However, the potential elimination of HECM-to-HECM refinances could be enacted outside of Congress by the FHA as an administrative change that doesn’t require Congressional approval. While opposed by key industry stakeholders, such a change could be held forth to lawmakers as confirmation of the agency’s continued commitment to the stewardship of the program should next month’s report reveal increasing financial liabilities.
The water is not quite under the bridge
Truth be told, recent fiscal year insurance claims provide little if any insight as to how effective previous policy changes may have been. Think of the reverse mortgage program’s financial liabilities as a large river. Notable incidents upstream will not be felt
HECM reforms the focus of Congressional hearing
Recent improvements, racial targeting, and some surprising suggestions
Despite the impeachment drama in our nation’s capital, the House Financial Services Committee’s hearing on the HECM was held as scheduled. It shows that some Congress members view of the HECM has evolved and some interesting proposals were put forth from the expert witnesses…
Documents referenced:
“Preventing Foreclosures on Seniors Act of 2019” [DRAFT]
A bill to conform HECM lending limits with FHA area limits
HUD Secretary committed to HECM changes
Secretary Ben Carson’s prepared remarks for recent Senate hearing confirm HUD’s mission to enact key HECM reforms
While politicians squabble over the government’s role in making homeownership a reality, older homeowners who wish to use their home’s value to age in place were left out of the debate in the hearing room. That doesn’t mean the HECM program is not facing some significant changes. In his prepared remarks, Secretary Carson outlines three changes- two which would require Congressional approval, and the third a mere policy change by the Federal Housing Administration (FHA)…
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BREAKING- New Collateral Assessment may require 2nd appraisal
FHA’s New Collateral Risk Assessment will require a 2nd appraisal when determined that 1st appraisal is ‘inflated’
BREAKING- FHA announced today the enactment effective October 1st that all HECM loans must undergo a Collateral Risk Assessment to determine if the first appraisal is inflated or at market values. If it is determined that the appraisal exceeds the assessment’s guidelines, then a second appraisal will be required which can be financed into the closing costs of the loan. Read the mortgage letter