HECM Appropriation Gets One Step Closer, Heads to the House

The House Committee on Appropriations passed the FY 2011 Transportation, Housing and Urban Development bill on Tuesday and included $150 million to support the Federal Housing Administration’s reverse mortgage program.

While the Obama Administration requested $250 million to support the HECM program, the appropriations committee provided the $150 million to “support elderly homeowners and assist them in keeping their homes rather than forcing them to move to expensive assisted living facilities,” said David Obey (D-WI), Chairman of the House Appropriations Committee in a statement.  “This level of assistance will keep the program running in 2011 at expected volume levels.”

Industry analysts tell RMD the $150 million puts appropriators estimates at roughly 69,000 HECMs during FY 2011.  Without the appropriation, HUD would be forced to drastically reduce principal limits for the second year in a row.

“We must continue our vigilance and make sure it is not taken away when the bill is brought to the floor for a vote in the full House,” said Peter Bell, President of the National Reverse Mortgage Lenders Association in an alert to members.

Others agree that there is still work to be done to ensure both the House and Senate provide support for the HECM program.

“Passage is an indication that we have growing support and awareness,” said Jeff Lewis, Chairman of Generation Mortgage and the leader behind the Coalition for Independent Seniors. “We have to continue our efforts to educate and bring the policy makers into the fold.”

The Senate is expected to introduce its FY 2011 Transportation, Housing, and Urban Development appropriations bill later this week.

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