The National Reverse Mortgage Lenders Association recently submitted a letter to the Department of Housing and Urban Development requesting clarification on more than a dozen implementation issues related to upcoming changes to the home equity conversion mortgage (HECM) program.
The 17 issues mentioned in the letter cover a variety of topics, including a request for clarification or confirmation that repair set asides must fit with in the first 12-month disbursement limit, whether those repairs would have to be completed prior to closing, and what happens if the set aside exceeds the initial disbursement limit.
Clarifications relating to the HECM for Purchase program are also requested, with NRMLA asking if HUD will allow a grace period for people under contract to buy a home through the Purchase program but who haven’t been able to get a case number yet pending the issuance of a certificate of occupancy.
Other topics include partial prepayment protocol, payment plan options and changes, and new documentation requirements.
“It is likely and highly probable that we will have further questions prior to September 30, 2013,” NRMLA says in the Sept. 6 letter, adding that the FHA’s answers may raise further questions and requests for clarification.
Click here to access the letter.
Written by Alyssa Gerace