While the Department of Housing and Urban Development has resumed insuring reverse mortgages under its Home Equity Conversion Mortgage program following a hiatus during the government shutdown, the agency is requesting patience from lenders as it resumes its insurance for the program.
During the 16-day shutdown, HUD was restricted from insuring reverse mortgages due to a cap on the number of HECMs the government can insure; the cap has been extended through a series of continuing resolutions.
While lenders continued making loans, they were not endorsed during the shutdown.
“FHA has worked diligently during the 16-day government shutdown to support the housing market, consumers, and stakeholders,” wrote HUD Deputy Assistant Secretary Charles Coulter in a letter to lenders. “We are very pleased to be fully operational and wanted you to know that we will be working hard to bring business back to normal.”
Through the shutdown, HUD continued many of its insurance activities as well as servicing and loss mitigation, with few interruptions, Coulter continued, but a backlog formed for some loans such as reverse mortgages.
“Some of the backlog includes processing HECM endorsements, other cases that must be manually endorsed, condominium project approvals, incoming questions from lenders or borrowers, etc. We are prioritizing the backlog and will be working to address more critical items within 30 days and then to clear our backlog within 60 days.”
Written by Elizabeth Ecker