HECM Cap Suspension Extended

The suspension of the cap on the number of Home Equity Conversion Mortgage (HECM) reverse mortgages that can be endorsed by the FHA has been extended again.

The House Appropriations Committee passed a Fiscal Year 2014 appropriations bill for the U.S. Department of Housing and Urban Development that extends by one year the suspension of the cap on the number of HECMs that the Federal Housing Administration can insure.

The bill – approved by a 28-20 vote – would extend the suspension until September 30, 2014.

As originally enacted in 1987, the HECM statute contained a volume cap of 2,500 loans.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.

Tradition Title Gives

In honor of the official start of the summer, this month Tradition Title has made a donation that honors the official game of the summer.

This month’s donation is to the Little League Challenger Division, which enables more than 30,000 boys and girls with physical and mental challenges to enjoy the game of baseball.

HECM Endorsements Rebound

Endorsements for the Home Equity Conversion Mortgage (HECM) increased 10.2%  year-over-year in April after the 27% decrease for the same month in the previous year, according to the latest from Reverse Market Insight.

California showed the most total volume at 2,914 units—a 12.2% growth change year-over-year, with Los Angeles, Orange and San Diego Counties taking the top three spots for HECM volumes in April,

New York also put in a strong showing with three of its own—Suffolk, Queens and Kings Counties

Zillow Predicts Significant Home Value Appreciation

Home values continued trending upwards across the nation in May, according to Zillow’s most recent Real Estate Market Report, rising 5.4% on a year-over-year basis.

National home values rose 0.5% from April to May to $159,000, matching June 2004 levels.

Between May 2013 and May 2014, Zillow’s Home Value Forecast predicts a 4.1% appreciation across the nation to $165,448.

 

Looking at the 30 largest metro areas covered by Zillow, 29 experienced year-over-year home value increases in May, with St. Louis as the only exception. Half were up by double-digits, with the most growth seen on a yearly basis in Las Vegas (up 28%), Sacramento, Calif. (up 26.1%) and San Francisco (up 24.2%).

More than half (51%) of the 360 markets Zillow covers showed monthly home value appreciation in MAy 2013, while 72% saw annual appreciation.

National home values are still down 18.3% from their peak in May 2007, but are up 7.2% from the post-recession trough in October 2011.

Home value appreciation is expected to slow down, even though economist believe the housing recovery will stay strong.

Earn CRMP Credits with Tradition Title!

Join us on June 25, 2013 at our offices in Bay Shore for the following educational sessions:

Understanding a Title Report (1 credit)  10AM – 11AM

Power of Attorney and Life Estate Basics for the Reverse Mortgage Transaction (1 credit) 11AM – 12PM

Trust Basics for the Reverse Mortgage Transaction (1 credit) 12PM – 1PM

Please RSVP if you plan to attend.

 

Tradition Title Agency, Inc.

67 East Main Street

Bay Shore, NY 11706

631-328-4410 – phone

631-328-4413 – fax

From the NRMLA Newsletter…..

RMMI Rises Fourth Straight Quarter

The NRMLA/RiskSpan Reverse Mortgage Market Index (RMMI) rose by 1.5% in the first quarter of 2013 to 155.0, its highest level since Q1 2009. The RMMI, which analyzes trends in the home values, home equity and mortgage debt of homeowners 62 and older, is updated quarterly and tracks back to the start of 2000.

The $49.5 billion increase in senior home equity was driven by an estimated $45.1 billion increase in the aggregate value of senior housing and a $4.4 billion decline in mortgage debt held by seniors.

While the index has now risen for four straight quarters, the $3.25 trillion estimated aggregate value of home equity owned by seniors eligible for reverse mortgages is still 19% below its peak level of $4.0 trillion in Q4 2006. The senior housing value estimate is based on the Federal Housing Finance Agency’s Q1 2013 all-transactions Indices, which saw housing values increase in 53% of the 395 metropolitan statistical areas (MSAs) covered by RiskSpan.

Dodd-Frank Reforms To Go Into Effect 2014

In a press release last week, the Consumer Financial Protection Bureau (CFPB) published the first update to its exam procedures for the new mortgage regulations it issued in January 2013.

The release of exam procedures will help financial institutions and mortgage companies understand how they will be examined for CFPB rules that:

• Set qualification and screening standards for loan originators: A loan originator must be ethical and knowledgeable. They will need to: meet character, fitness, and financial responsibility requirements; pass criminal background checks; and complete appropriate training.
• Prohibit steering incentives: Compensation for a loan originator generally cannot vary with the loan terms. A broker or loan officer cannot get paid more if the consumer takes a loan with a higher interest rate, a prepayment penalty, or higher fees.
• Prohibit “dual compensation:” A loan originator cannot get paid by both the consumer and another person such as the creditor.
• Protect borrowers of higher-priced mortgage loans: The required duration of an escrow account on higher-priced mortgage loans extends from a minimum of one year to a minimum of five years.
• Prohibit the waiver of consumer rights: It is prohibited to bar consumers in their mortgage or home equity loan or related agreements from bringing a claim in court in connection with any alleged violation of federal law.
• Prohibit mandatory arbitration: Mandatory arbitration of disputes related to mortgage loans is generally prohibited for mortgage and home equity loans.
• Require lenders provide appraisal reports and valuations: Mortgage lenders will need to provide applicants with free copies of all appraisals and other written valuations developed in connection with certain mortgage loan applications.
• Prohibit single premium credit insurance: Creditors will be prohibited from financing certain credit insurance premiums in connection with certain mortgage loans.

Read the full press release here:

http://www.consumerfinance.gov/pressreleases/the-cfpb-releases-exam-procedures-for-new-mortgage-rules/