Today FHA Commissioner Brian Montgomery conducted a telephone briefing on the FHA Modernization legislation and he announced that HUD will be eliminating the HECM Advisor program. According to NRMLA, HUD will be issuing a Mortgagee Letter within the next 30 days because the new law requires that, “All parties that participate in the origination of a mortgage to be insured under this section shall be approved by the Secretary”. Once the letter is issued and takes effect, only employees of FHA-approved lenders and correspondents will be permitted to participate in the origination of HECMs.
Also, HUD lawyers still haven’t resolved whether the bill creates a single national loan limit at $417,000 or $625,500, or area limits at 115% of area median home value, with a floor of of $417,000 and a cap of $625,500. NRMLA expects to get a final decision from lawyers within the next couple of days.