► HUD posted on Sept. 23: Mortgagee Letter 2009-34 …This Mortgagee Letter announces a new set of principal limit factors (PLFs) for the Federal Housing Administration (FHA) HECM (Home Equity Conversion Mortgage) program, to assist with the viability of the program. The new principal limit factors must be used for all HECMs for which the FHA case number is assigned on or after Oct. 1, 2009. The letter has a link to the principle limit factor table. Click here to view the full story.
► SunSentinel posted on Sept. 23: New FHA rule will make it harder for senior citizens to get a reverse mortgage …No “spot approvals” is likely bad news for condo buyers and sellers, since it effectively means the Federal Housing Authority will not back a loan for a condo in a building that has not been approved by the federal agency…"spot approvals" for single units in a non-approved building…have been allowed in previous years.
► ReverseMortgageDaily posted on Oct. 5: HUD Awards $32 Million to Upgrade Reverse Mortgage Technology … The new system will accurately maintain all active and historical loan level records such as loan and borrower characteristics, loan balances, and case status, and provide HUD management with ready access to data for financial, budgetary and other reporting needs.
► ReverseMortgageDaily posted on Oct. 1: Financial Freedom Discontinues Fixed Rate Reverse Mortgage in Illinois … This comes after Bank of America announced it was suspending its fixed rate HECM in the state because of the Illinois High Risk Home Loan Act (HRHLA).
► The Daily Herald posted on Oct. 2: Government's reverse-mortgage option for seniors is scaled back …In a letter to reverse mortgage lenders Sept. 23, FHA Commissioner David H. Stevens said his agency must reduce the maximum amounts seniors can receive on reverse mortgages because of a $798 million estimated budgetary shortfall for the program in the coming fiscal year. Mortgage industry sources said the move amounts to a 10 percent cutback for all new FHA reverse mortgage applicants starting Oct. 1.
► Mass Live posted on Sept. 30: Mass. Undersecretary of Consumer Affairs Barbara Anthony asks lawmakers to craft new ways to protect consumers … Anthony urged a requirement for “face to face” counseling sessions before people sign up with a bank or another lender, except when there is an extreme hardship and lenders should be banned from pushing products such as annuities or long-term care insurance while offering a reverse mortgage.
► Consumer Reports Magazine published in their Sept. 2009 issue: Reversals of fortune: The next financial fiasco? It could be reverse mortgages …an unbalanced article calling reverse mortgages a “last resort” with comparisons to the sub-prime debacle, “skimpy counseling” that leads the unsuspecting borrower to become prey to inappropriate marketing and cross-selling of financial and insurance products and taxpayer funded bail out for HUD’s mortgage insurance program.
A former AARP-certified reverse mortgage counselor with five years of experience, Jean Ross is now a mortgage planner with AdvisorNet Mortgage LLC. Jean specializes in reverse mortgages, and is most interested in getting accurate and useful information on reverse mortgage to seniors, their families and professionals who work with them.