The Federal Housing Administration (FHA) on Wednesday announced mandatory transition dates for mortgagees to submit appraisals for both single family forward and reverse mortgage endorsements through its FHA Catalyst software. This is according to the publication of Mortgagee Letter (ML) 2021-23.
Of particular attention to the reverse mortgage industry should be that Catalystnow has Home Equity Conversion Mortgage (HECM) appraisal submission functionality as a new capability that is immediately available within the module, according to FHA.
In the document, FHA specifies all of the dates at which submissions through Catalyst will become mandatory. Effective on and after March 14, 2022, appraisal delivery through the FHA Catalyst: Electronic Appraisal Delivery (EAD) Module is mandatory for all cases unless a previous appraisal version has been submitted to the legacy EAD portal, the letter explains.
However, for cases with a previous appraisal submission in the legacy EAD portal before March 14, 2022, appraisal resubmissions may continue to be delivered through the legacy EAD portal until April 15, 2022. After that date, appraisal submissions for all cases, regardless of previous submission status, must be delivered through the FHA Catalyst: EAD Module.
The publication of this ML establishes that Catalyst now has the additional functionality of delivering HECM appraisals, in an effort to streamline the methods available to the reverse mortgage industry for such submissions. Unless otherwise noted, HECM appraisals will need to follow the same timeframes outlined in the ML which also applies to the single family forward mortgage program managed by FHA.
This new functionality follows on from a series of updates that the agency has made to the software this year, including a prior update which allowed mortgagees to more quickly and accurately respond to FHA’s request for case binders on both the forward and reverse sides of the mortgage business.
This past summer, FHA also published an update to the Single Family Housing 4000.1 handbook which incorporated policies requiring mortgagees not approved for eCaseBinder (eCB) submission through FHA Connection (FHAC) to use the FHA Catalyst: Case Binder Module to submit both Single Family forward and Home Equity Conversion Mortgage (HECM) case binders that were requested through the Loan Review System (LRS) for post-endorsement technical review.
Read the details of the new provisions in Mortgagee Letter 2021-23 at HUD.