No Mortgagee Letter yet for the new single national loan limit for HECMs, but according to NRMLA’s latest alert we are getting close. Yesterday, NRMLA sent an email stating that the Office of Single Family Housing hopes to complete drafting the Mortgagee Letters (one for loan limits and one for origination fee caps) and place them into the “departmental clearance” process this week. The goal remains to send them out in time for a November 1 effective date or possibly a few days earlier.
See below for other things NRMLA has learned:
- The 150% multiplier used to calculate loan limits in Alaska, Hawaii, Guam and the U.S. Virgin Islands still applies. The Mortgagee Letter should provide that info.
- Borrowers in the pipeline will be able to take advantage of the new loan limits, but the paperwork on their loans will have to be redone and a new application taken, dated after the effective date of the Mortgagee Letter.
- Loans to borrowers in the pipeline for which new applications will be taken to utilize the new loan limits will, of course, be subject to the new origination fee limitations.
I’m also hearing that we are working with HUD to allow lenders to re-disclose new loan limits and fees instead of requiring them to sign all new loan documents. If I hear anything else I will let you know.