Reverse Loan Changes, Part 2

Here is the remainder of the article discussing the pending changes to the HECM Reverse mortgage program.

“Officials have stated to Congress and the public that the desired changes [2] will shore up the FHA’s insurance fund for its HECM program and will also make the products safer and more sustainable for borrowers.

While additional program changes have been discussed, including a financial assessment of borrowers and a set aside for property tax and insurance payments, those changes are not expected to come in the first set of product changes, rather they are expected to be released in the coming months.

The new product will come with new mortgage insurance premiums that are dependent upon the amount that is drawn upfront and whether that amount falls under or exceeds a 60% threshold. Only borrowers with mandatory obligations will be able to exceed that threshold.

Details are expected from HUD some time before September 1. The agency has stated [3] it would like to implement the changes before October 1, 2013.”

Written by Elizabeth Ecker [4]

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