A new law implemented by the local government of the nation’s capital is extending protections for reverse mortgage borrowers in the area who find themselves in delinquency.
The Council of the District of Columbia, the legislative branch of the local government, has passed the “Reverse Mortgage Insurance and Tax Payment Program Temporary Amendment Act of 2020” to extend the area’s Reverse Mortgage Insurance & Tax Payment Program (ReMIT), launched in 2019 by the District of Columbia Housing Finance Agency (DCHFA).
On the law’s passage, DCHFA is grateful for the efforts of local leadership in recognizing the service that the law will help the ReMIT program to continue to provide, according to DCHFA Director of Public Relations Yolanda McCutchen.
“DCHFA is grateful to Councilmember Anita Bonds (Councilmember At-Large Council of the District of Columbia) and the members of the Committee on Housing and Neighborhood Revitalization of which she chairs for introducing the Reverse Mortgage Insurance and Tax Payment Program (ReMIT) Emergency Amendment Act of 2020,” McCutchen tells RMD. “We are grateful to the entire Council for unanimously voting to continue the program and expand the qualifications.”
New program coverage
The law as passed makes a couple of substantive changes to the original program. First, it extends the life of the program by two years, “with a six-month planning period and an 18-month implementation period, subject to available funds,” according to the text of the law. Second, the law adds condominium fees and homeowners association (HOA) fees in addition to previous coverage that includes property tax and property insurance debts.
The additional features that the new law adds onto the ReMIT program will help to further assist District homeowners that have a need which can be met by the program, she adds.
“Now seniors that are at risk of foreclosure due to unpaid condominium or HOA fees may also qualify for ReMIT which will allow more District seniors to have the opportunity to retain ownership of their homes,” McCutchen says. “Before the passing of this amendment DCHFA’s staff had encountered seniors in this predicament but were unable to provide them assistance through ReMIT.”
The inclusion of condo and HOA fees have led to DCHFA to update all collateral and online materials related to the ReMIT program, as well as an update of the information shared with housing counselors.
The new law was approved by Washington, D.C. mayor Muriel Bowser in mid-June after gaining approval from the council earlier in the year.
ReMIT was first launched by DCHFA in March of 2019, and stemmed from District of Columbia residents — comprising both reverse mortgage borrowers and their family members — submitting complaints to the local government concerning people who had fallen behind on their property taxes and were then put at risk of losing their homes. In its first year, the program lent nearly $95,000 in assistance, according to McCutchen.
Qualified applicants for assistance must meet a specific set of criteria, including residence in the District, being secured by a reverse mortgage in the borrower’s name, the subject property must be the primary residence (and located in the District), with beneficiaries also needing to fall into an annual income cap of $77,540 (which, DCHFA points out, is “subject to change”).
The subject property must also be “at risk” of foreclosure due to unpaid property taxes, homeowner’s insurance, condominium and HOA fees, and a potential beneficiary must demonstrate the ability to sustain future payments of their taxes, insurance and fees.
”With ReMIT, we aim to prevent and reduce the number of foreclosures that are happening in D.C. as a result of delinquent tax and insurance payments,” said the late Todd A. Lee, former executive director and CEO of DCHFA when the program launched. “ReMIT, along with the Agency’s other foreclosure prevention program, HomeSaver, will allow residents to continue living in their homes that they have worked hard to maintain.” Mr. Lee passed away in January.
The program remains a priority for DCHFA, according to McCutchen.
“DCHFA is proud to administer the ReMIT program and continue to offer programs to support lower income seniors to maintain ownership of the homes that they worked hard to obtain in Washington, D.C.,” she says.
Find the full text of the new law at the D.C. Council website.