Tag Archives: Home Equity Conversion Mortgages

HUD Changes to FHA Mortgage Programs

5 Nov

The Department of Housing and Urban Development recently announced two changed to their loan programs.

 

Yesterday at the NRMLA conference in New Orleans, Federal Housing Administration Assistant Secretary Carol Galante said that the January 13, 2014 implementation of a financial assessment for HECM reverse mortgage borrowers will be delayed by an unspecified time period. The extra time will allow FHA to make sure the change is implemented precisely and with budgetary health in mind, Galante said.

 

The Department of Housing and Urban Development (HUD) also recently updated the schedule of claimable attorney fees and reasonable diligence time frames for initiating foreclosure on FHA-insured loans, including Home Equity Conversion Mortgages (HECMs).

Changes were announced via Mortgagee Letter 2013-38 letter issued Oct. 28 and which applies to all cases in which the first legal action to initiate a foreclosure occurs on or after Nov. 1, 2013 and encompasses all federally insured mortgages.

HUD limits the amount of fees attorneys can claim and requires servicers to prosecute foreclosure in a specific time frame. The department hadn’t updated its guidance since 2005, presenting challenges for FHA servicers trying to meet reasonable diligence time frames and recoup the correct attorney fees when prosecuting foreclosures on FHA-insured loans.