HUD Pushes Back New Reverse Mortgage Technology Release

Finding anyone using a computer system developed over 20 years ago is no easy task, unless you take a look at the technology powering the the Department of Housing and Urban Development’s reverse mortgage program.

Created in 1989, the Insurance Accounting Collection Systems (IACS) was developed as a prototype for the Home Equity Conversion Mortgage (HECM) pilot program.  This “antique” has been the backbone of the HECM program ever since.

HUD was expected to roll out the second generation system – HERMIT – in November, but the agency is pushing it back until March or April of next year according to people briefed on the decision.

RMD spoke with one of the developers behind the system and learned HUD wants to get everything right with HERMIT.  “HUD likes the progress that has been made but they just don’t want to rush it out,” said the developer.  “By pushing it back, we can perform additional development and testing that is needed to make sure everything runs smoothly when it’s launched.”

Other companies we spoke to are all very supportive of HUD’s decision.

HUD awarded a $32 million contract to upgrade the software in October 2009 to Quality Software Services, which partnered with CoTs, GTBS, Walker and Company, and Reverse Mortgage Solutions (RMS) to build the system.

The new web based software is powered by STORM, a servicing platform developed by RMS that can handle the increasing demand for HECM loans and provide one solution to support the entire process. According to HUD’s statement of work, the system currently being used is a time consuming and manual processes because the data resides across a variety of different platforms.

They new system will also help “improve overall monitoring and oversight over the various stages of the products life cycle,” said HUD.

HUD did not respond to RMD’s request for comment.

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