HUD proposed 11 changes to the HECM program- here are the six most notable
HUD proposes numerous changes to the Home Equity Conversion Mortgage in Congressional Report. Here’s what you need to know.
Welcome back to the Industry Leader Update. First two good pieces of news. Last month was notable for the highest number of HECM endorsements in March since 2011. Second, the HECM program is running in the black (what HUD officials refer to as a negative credit subsidy) meaning no additional appropriations are needed to cover the costs or claims of the program. Both of these we can attribute to historically low-interest rates and a record increase in home price appreciation. All this helps HUD generate a positive budget proposal for Congressional approval.
The 420-page document that accompanies the budget request, Congressional Justifications, explains the rationale for the budget requests. This document includes eleven proposed legislative changes to the HECM program. These proposals are quite tame when compared to a previous slate of HECM reforms proposed under the Trump Administration which included eliminating HECM refinances altogether, abolishing the national lending limit, and separating the HECM program from FHA’s Mutual Mortgage Insurance Fund.
So today we will briefly the six most notable proposed changes announced just over a week ago.
