Reverse Mortgage “Kill Switch” Postponed, HUD Expects Delays in Wake of Sequester

ReverseFocusReverse Focus Weekly Podcast Episode #249

In this week’s Reverse Focus podcast, Shannon Hicks discusses the “kill switch,” or the cap limit on the number of reverse mortgages that can be insured by the Federal Housing Administration (FHA) has been postponed.

Under a continuing resolution passed by the House of Representatives last week, the cap on reverse mortgages has been suspended once again through September 30.

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Budget cuts stemming from the sequester has the Department of Housing and Urban Development (HUD) planning for seven days of employee furloughs between May and September. During these days, HUD will experience closures and reductions in system maintenance could mean delays processing mortgage insurance applications, according to FHA Commissioner Carol Galante.

The online mortgage comparison service, Lending Tree, has gone reverse mortgage. Last week, Lending Tree announced it will be providing reverse mortgage leads through its online marketplace. The platform, Loan Explorer, offers shoppers real time mortgage information and can allow customers to compare offers as well as look at costs and rates. 

Also discussed in the podcast, Oregon lawmakers passed a bill Wednesday that will allow past reverse mortgage borrowers to re-enter the state’s senior tax deferral program. This is a substantial reversal, Hicks notes, as in the past those who decided to receive the benefits of the deferral program could no longer participate if they held a reverse mortgage. The bill will allow 1,500 seniors to be grandfathered into the program, however, new reverse mortgage borrowers cannot not qualify.

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Talking Points:

  • Cap limit “kill switch” turned off for another year
  • Budget cuts impact HUD, delays expected
  • Lending Tree goes reverse with online marketplace
  • Oregon allows reverse borrowers back into property tax deferral program

Listen Now“Reverse Focus is the ultimate resource for reverse mortgage professionals providing the technology, training and marketing to grow your business. We are your one-stop resource for those committed to taking their business to the next level.”

Editor’s Note: These posts are sponsored by Reverse Focus.

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