Financial Freedom For Seniors

1-954-822-8443

Blog

Reverse Mortgage Industry News -- From Capitol Hill

Posted by Ricky Rash, CRMS on August 26, 2009 at 4:50 PM

For those Congressmen who have had it with the healthcare town meeting circuses at home, we’re ready for you to come back to DC. We’re awaiting some big decisions when the Drama on the Hill autumn act begins. Still on the table are the possibility of an appropriation to cover OMB’s projected HECM insurance shortfall for fiscal 2010, an extension of the $625,500 national loan limit and continuation of the suspension of the cap on total reverse mortgage output.

 

Here’s an update on where the issues stand:

 

APPROPRIATION

 

To recap: The request for a credit subsidy for the first time in the history of the HECM program appeared in the President’s fiscal 2010 budget. OMB estimated a subsidy of $798 million would be required to cover losses that might be incurred over the life of loans originated in FY 2010. The need is apparently based on an estimated continued drop in home prices, though OMB does not reveal what that estimate is in fear of creating a self-fulfilling prophesy.  The estimate was then confirmed in an independent program assessment made by the Congressional Budget Office.  In June, newly confirmed HUD Secretary Shaun Donovan was quoted as saying, “We are open to raising premiums or restricting eligibility to cover the subsidy.”

 

Where we now sit: The bill passed by the House contains no appropriation but advises the HUD Secretary to make adjustments to the principal limit factors to achieve a net zero subsidy rate.  The bill passed by the Senate Committee on Appropriations provides for a subsidy of $288 million. It also calls for a 5% reduction in the principal limit. This bill will be voted on by the entire Senate when it returns from August recess.

Negotiations continue among Congressional staffers while members of Congress are away on recess. The fact that the House and Senate versions of the bill have differing provisions on HECM means that the issue is a highly negotiable item.

 

The discrepancy simply throws the bill into conference. The final decision doesn't necessarily have to be what's in either bill. It could be completely different, even providing the entire $798 million credit subsidy initially requested in the President's budget proposal.

 

NRMLA has been providing information to key Congressional staffers and others who are trying to help us preserve the HECM program as it currently operates. For example, an analysis of three of our major lenders' portfolios has shown that nearly 21% of current borrowers would have come up with too little cash from the reverse mortgage to pay off their existing indebtedness if principal limits are reduced by 10% - resulting in many being forced to move out of their homes.

 

 

 

PRINCIPAL LIMIT

 

In February 2009, the American Recovery and Reinvestment Act raised the maximum claim amount for HECMs from $417,000 to $625,500—but only through December 31, 2009.  The House bill would extend the $625,500 limit through September 30, 2010.  The Senate committee version of the bill does not address loan limits for HECM or other FHA programs. If the language in the current Senate version were to be enacted, the HECM maximum claim limit would return to $417,000 as of January 1, 2010 for the balance of fiscal 2010 (which runs through September 30, 2010.) Historically, the House has been more assertive on FHA loan limits and the Senate has typically accepted the House provisions on this topic.  Once again, this will be decided in conference and current positions are no indication of where that committee will come down.

 

LOAN CAP

ARRA also continued an ongoing suspension of the loan authorization cap, or the total number of the HECMs that HUD can insure at any time, through December 31, 2009.   Currently, both the House bill and the Senate Appropriations committee bill extend the suspension of the loan cap through September 2010.

As reported in the NRMLA Monday Report on August 17, a group of association members are working together as a Re-Engineering Task Force examining the assumptions made by the OMB and CBO that resulted in the call for a subsidy, considering the proposals in both the House and the Sensate committee’s bills and exploring other possible methods of covering any possible shortfall.

 

ALSO IN THE WINGS: HUD COUNSELING PROTOCOL

 

In addition to the decisions on the Hill, we have been awaiting the release of the new HUD counseling protocol. Given the critical evaluation of counseling in the GAO report and the concern expressed publicly by Comptroller of the Currency John Dugan that too many seniors cannot afford to keep up on their taxes and insurance payments, new ideas could not be issued at a more opportune time.  From presentations at our conferences by some of the people involved at HUD, most notably Meg Burns, the Director of the Office of Single Family Program Development for the FHA, and Ruth Roman, the Director of the Program Support division for the Office of Single Family Housing, we can anticipate the following improvements to be adopted in both lending and counseling:

 

To address the taxes and insurance issue, HUD has been discussing requiring lenders to do a financial assessment of potential borrowers, to determine whether or not they will be able cover their monthly obligations, plus taxes and insurance, after obtaining the HECM. If it is deemed that there might be a problem, the lender will be required to either:

 

(1.) Create a taxes and insurance set aside

(2.) Put a limit on the payment plan that assures enough cash remains for the ongoing expenses

(3.) Take other steps as are necessary to help protect the borrower from a tax or insurance default

 

The counseling protocol will focus on counselors explaining what the features of the product mean by giving the clients examples of circumstances. Counselors will have to provide borrowers with handouts in preparation for a counseling session. They will be required to perform an assessment of the borrowers’ comprehension of the session by mixing a series of specific questions designed to measure grasp of the product into the conversation. In addition, emergency counseling will be made available for those facing illness or foreclosure and in need of swifter action.  Along with the new protocol, HUD will be introducing a new Roster of HECM Counselors. Qualifying for the HECM counseling roster will require that an individual be employed by an approved counseling agency, pass an exam, take continuing education credits and retake the exam every three years.

 

HUD will also initiate a “mystery shopping” program to check on counselors adherence to the protocol, which can address the concerns in the GAO report. Counselors who are found to need additional training will be provided with mentoring.

Categories: None

Post a Comment

Oops!

Oops, you forgot something.

Oops!

The words you entered did not match the given text. Please try again.

Already a member? Sign In

5 Comments

Reply Ellene Pearce
3:39 PM on March 16, 2014 
If somone has a reverse mortgage who was 76 and dies but married after getting the reverse motrgage that person is 61 the person that dies got a living trust and put it in the 61 year old"s name does he get the house? The house is in Lake Havasu City AZ and has a Financial Freedom Reverse Mortgage on it. the husband who is 61 said the house is his.since his wife died recently
Reply AaauceMum
12:16 PM on July 29, 2017 
Segway Verona offers tours that make sure you will enjoy a fun and immerse experience of our beloved city. We combine Segway, our innovative way of transportation, with tours in the historical city centre. Through our explorations of 1 or 2 hours, we will bring you to the most breathtaking spots, so that, if you do not stay long in Verona, we make sure that you see all of the unmissable sights!

Segway is really easy to use! It is so intuitive that it feels like an extension of the human body. To understand why, consider this: if you stand up and lean forward, so that you are out of balance, you will intuitively put your leg forward. Segway works the same way: to move forward or backward, the rider just leans slightly in such direction, and Segway will follow your movements. It is also easy to turn right or left, since the rider just has to push respectively Segway?s handlebar.

Segway is safe. Anyone over the age of 12 can join our tours, except for pregnant women. Apart from these cathegories, we encorage people of every age to try Segway, because this self-balancing object can really make your experience in Verona much more delightful! In fact, if it is hot, you will enjoy some fresh air and avoid to sweat; if it is cold, you will have the possibility of staying outside the least possible time. It is proved that our 2 hours tours show you what you will see in 6 hours walking!

All the tours start with a little training on how to use Segway, because for us safety is the priority. However, we experienced that it takes just a little practice to master on Segway! There are no required skills and, in particular, no need to be able to bicycle. There will always be a tour leader with you, guiding the whole group, so that you can enjoy the view and the tour of Verona. Audioguides (available in different languages) will provide the information you need to fully comprehend the history and architecture of our main monuments, squares and buildings.

In particular, our 2 hours tour will show you: Piazza Bra, one of the biggest squares in Italy, with the Arena, the famous Roman amphitheatre; we will then take Via Oberdan in order to see Portoni Borsari, one of the ancient entrance of the Roman city; we will firstly explore Piazza Erbe and secondly Piazza Dei Signori, two squares full of symbols and buildings with enchanting beauty, and then see Arche Scaligere. Heading to the Duomo, Verona?s Cathedral, we will pass by Santa Anastasia, next to the Conservatory of music; after that, we will have a break on Ponte Pietra, the bridge with the breathtaking view of the Roman Theatre and San Pietro Castle (and much more). On our way back, we will stop at Juliet?s house, so that you don?t forget to take pictures and write your names on the walls! We will conclude our tour with Castelvecchio, the Scaligeri castle and enjoy its amazing view of Verona.

People who went on tours with us really appreciate our flexibility: we do not have fixed tour?s hours, so we can arrange the time that fits the best. Moreover, we try to adjust the path according to your preferences, spending less time on spots you have already seen and dedicate more on your favourite sights. Read what people say about us on tripadvisor...

So, if you want to make the most out of your time in Verona, contact us or stop by our office!

OFFICE HOURS: Monday to Saturday (only closed on Sunday) from 10 am to 5 pm.

DIRECTIONS: We are located in Piazza Cittadella 11b, very close to Piazza Bra, the main square with the Arena.

From Piazza Bra you can arrive at our office on foot (3 minutes): pass under the arch of the gateway with the big clock (Portoni della Bra) and walk through Corso Porta Nuova for approximately 100

https://veronasegwaytours.com/
Reply SUJohnatiz
11:42 PM on August 1, 2017 
метформин для похудения отзывы http://диетоника.товар-топ.рф
Reply DannyAnink
1:02 AM on August 13, 2017 
ВНИМАНИЕ!!! Ядекс и отношение к клиентам смотреть всем!!!
Посмотрел и был в ШОКЕ....
Вот ссылка на Ютуб
https://www.youtube.com/watch?v=IdYDpLcuVnA
Reply GeorgeDweme
9:28 AM on August 24, 2017 
картинки млм бизнес, сетевой бизнес москва

Follow me on Twitter

Powered by Webs

Send to a friend

Share on Facebook

Share on Facebook

Webs Counter