HUD wants HECM Saver to represent 30% of all reverse mortgages

After the initial roll out of the HECM Saver, Vick Bott, Deputy Assistant Secretary for the Department of Housing and Urban Development said the agency would like to see it represent a minimum of 30 percent of all reverse mortgages it insures. Released earlier this month, the product provides consumers with less in proceeds but at a much lower cost compared to the traditional Standard HECM. During an interview with Reverse Fortunes, Bott said the decision to develop the HECM Saver was two fold. First, even before she joined HUD, the market had been asking for a low cost product that didn’t require borrowers to leverage all the equity in their home. Second, when the Obama Administration released its FY 2011 budget, the program was reported to need a $150 million subsidy to break even for the year.

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