House Spending Bill Extends HECM Volume Cap

18 Jun

from NRMLA

As part of the Fiscal Year 2013 appropriations bill for the U.S. Department of Housing and Urban Development, the House Appropriations Subcommittee on Transportation, Housing and Urban Development, and Related Agencies included language that extends by one year the suspension of the cap on the number of Home Equity Conversion Mortgages that the Federal Housing Administration can insure.

The pending legislation would extend the suspension until September 30, 2013. A staff person on the Appropriations Committee said the bill could be brought to the full committee within 1-2 weeks, though nothing will be publicly announced until three days before the actual hearing.

The Senate Appropriations Committee has already approved a THUD appropriations bill that includes a cap extension.

As originally enacted in 1987, the HECM statute contained a volume cap of 2,500 loans. That was increased by various increments several times, and finally to 275,000 loans permitted in 2006. Since that time, the cap has not increased but has been temporarily suspended, and the suspension was extended numerous times.

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