Guidance allows lenders to assign loan to HUD and keep non-borrowing spouse in the home
WASHINGTON – The Federal Housing Administration (FHA) today issued a new policy under its Home Equity Conversion Mortgage (HECM) Program giving FHA-approved lenders the option to delay calling HECMs with eligible ‘non-borrowing spouses’ due and payable. A delay would postpone foreclosure normally triggered by the death of the last surviving borrower. FHA’s new guidance will allow reverse mortgage lenders to assign eligible HECMs to HUD upon the death of the last surviving borrowing spouse, thereby allowing eligible surviving spouses the opportunity to remain in the home despite their non-borrowing status.
Last year, FHA amended its HECM policies to allow for the deferral of foreclosure, or ‘due and payable status’ for certain Eligible Non-Borrowing Spouses for case numbers assigned on or after August 4, 2014. Today’s action allows lenders to offer similar treatment for eligible HECMs and Eligible Non-Borrowing Spouses with FHA case numbers issued before August 4, 2014.
Under FHA’s new policy, lenders will be allowed to pursue claim payments for HECMs with Eligible Surviving Non-Borrowing Spouses and Case Numbers assigned before August 4, 2014 by:
- Allowing claim payment following sale of the property by heirs or estate;
- Foreclosing in accordance with the terms of the mortgage, and filing an insurance claim under the FHA insurance contract as endorsed; or
- Electing to assign the HECM to HUD upon the death of the last surviving borrower, where the HECM would not otherwise be assignable to FHA. (The MOE Assignment)
By electing the Mortgagee Optional Election Assignment, lenders will be permitted to modify their FHA mortgage insurance contracts to permit assignment of an eligible HECM to HUD despite the HECM being eligible to be called due and payable as a result of the death of the last surviving borrower.
WASHINGTON – U.S. Housing and Urban Development Secretary Julián Castro today announced the Federal Housing Administration (FHA) will reduce the annual premiums new borrowers will pay by half of a percent. This action is projected to save more than two million FHA homeowners an average of $900 annually and spur 250,000 new homebuyers to purchase their first home over the next three years.
Today’s action also reflects the improved economic health of FHA’s Mutual Mortgage Insurance Fund (MMIF). FHA’s recent annual report to Congress demonstrates the economic condition of the agency’s single-family insurance fund continues to improve, adding $21 billion in value over the past two years.
“This action will make homeownership more affordable for over two million Americans in the next three years,” said U.S. Department of Housing and Urban Development Secretary Julián Castro. “Since 2009, the Obama Administration has taken bold steps to reduce risks in the mortgage market and to protect consumers. These efforts have made it possible to take this prudent measure while also ensuring FHA remains on a positive financial trajectory. By bringing our premiums down, we’re helping folks lift themselves up so they can open new doors of opportunity and strengthen their financial futures.”
In the wake of the nation’s housing crisis, FHA increased its premium prices to stabilize the health of its MMI Fund. In addition, the Obama Administration took dramatic steps to safeguard consumers in the mortgage market to ensure responsible borrowers continued to have access to mortgage capital as many private lending sources tightened their lending standards.
Today’s reduction will significantly expand access to mortgage credit for these families and is expected to lower the cost of housing for the approximately 800,000 households who use FHA annually.
FHA’s new annual premium prices are expected to take effect towards the end of the month. FHA will publish a mortgagee letter detailing its new pricing structure shortly.
2015 Loan limits for highest and lowest cost areas to remain unchanged
WASHINGTON - The Federal Housing Administration (FHA) today announced the agency's news schedule of loan limits for 2015. These loan limits are effective for case numbers assigned on or after January 1, 2015, and will remain in effect through the end of the year.
FHA's calculation for maximum loan limits in high cost metropolitan areas of the country will remain the same as the 2014 level of $625,500. The current standard loan limit for areas where housing costs are relatively low will also remain unchanged at $271,050.
Each year, FHA recalculates its national loan limit based on a percentage calculation of the national conforming loan limit. Depending on those limits, FHA's minimum national loan limit "floor" is at 65 percent of the national conforming loan limit. The floor applies to those areas where 115 percent of the median home price is less than 65 percent of the national conforming loan limit.
Conversely, any area where the loan limit exceeds the "floor" is considered a high cost area. The maximum FHA national loan limit "ceiling" is at 150 percent of the national conforming limit. In areas where 115 percent of the median home price (of the highest cost county) exceeds 150 percent of the conforming loan limit, the FHA loan limits remain at 150 percent of the conforming loan limit.
Areas are eligible for FHA loan limits above the national standard limit, and up to the national ceiling level, based on median area home prices. Additional information and loan limit adjustments for two-, three-, and four-unit properties, and in Special Exception Areas, are noted in FHA's mortgagee letter. An attachment to the Mortgagee Letter provides information on which counties are eligible for loan limits above the national standard. Borrowers with existing FHA insured mortgages may continue to utilize FHA's Streamline refinance program regardless of their loan balance.
The mortgage loan limits for FHA-insured reverse mortgages will also remain unchanged. The FHA reverse-mortgage product, known as the Home Equity Conversion Mortgage (HECM), will continue to have a maximum claim amount of $625,500, with actual loan limits based on property value, borrower age, and current interest rates. Reverse mortgages allow homeowners age 62 and older to age in place by borrowing against the value of their homes without any requirements for monthly payments; no repayment is required as long as a homeowner lives in the home. The reverse mortgage is repaid, with interest, when the homeowner leaves the home.
Special Personal Cost Savings Report From Government Deal Funding!
People around the world, and around the country, are becoming less complacent about the choices they make. They are beginning to understand that some of the decisions they've made in the past were wrong and need to be changed. They are beginning to understand the renewable energy advantages.
Things like solar power and wind power are clean, renewable, and very cost effective for household use. As technology advances the advantages to these types of energy sources will only increase.
As we find even more advanced methods for converting energy from the wind and sun into power and learn more effective ways to store that power, we will dramatically increase the usefulness of these methods.
Many people are installing their own solar panels and wind turbines today, and both can effectively cut your energy bill as well as the negative impact of using fossil fuels for electricity.
Here is a list some some of the advantages to implementing renewable resources into your household:
1. By providing even a portion of your electricity needs using solar power and/or installing a wind turbine you can cut your utility bill by up to 80%. When you calculate what that would be over the course of years you will see that the savings is significant.
2. The more you can contribute to your own energy needs with renewable energy sources, the less of the pollutant rich fossil fuels you will have to use.
3. Neither wind nor solar power pollutes the environment with their use.
I know some of these things may seem obvious but it's important enough to be reiterated. If you want to help the planet and save money at the same time you owe it to yourself to do a little more research into renewable energy advantages. Saving money while saving the planet: there just isn't a downside.
Special Personal Cost Savings Report From Government Deal Funding!
Heading into this winter season many families are understandably nervous. It's a tough economy and many people are worried about their jobs and keeping up with rising costs. But there are many cheap, or free, things you can do to cut energy bills. Here is a list of some of the easy, yet effective, changes you can start making today.
1. Make sure your furnace is ready for the winter.
Have a qualified HVAC professional check and clean your unit. Once the heating season starts make sure to change your filters monthly. If the filter is dirty it will restrict airflow which will use more energy since it has to work harder.
2. Add a programmable thermostat.
You can set it to automatically adjust the temperature at certain times of the day and certain days of the week. That way the temperature in your home will automatically go down during the day when no one is home, or overnight. It can also raise the temperature shortly before you get up in the morning.
3. Take care of your fireplace.
Make sure the chimney is cleaned and in good repair. If you use your fireplace more than once a week you should have it professionally cleaned yearly. Also install a cap or screen at the top of your chimney to prevent birds from building nests.
4. Caulk around your windows and doors.
The more heat loss you can prevent the less your furnace will have to run, and that will save you money all season long. Using window kits is another way to prevent heat loss from older windows.
5. Using wind power
(Think home windmill!) Along with the above winterizeing tips and this will more than put you ahead of the game; on cutting your long term electric bills.
Now is a good time to make some simple changes that can help you cut energy bills this winter. Take a few minutes now to save hundreds not only this winter but throughout the year and for years to come.
SACRAMENTO, CA – The California Housing Finance Agency announced a major program expansion to help more low to moderate income California families purchase homes.
CalHFA will remove the first-time home buyer requirement on its first mortgage programs to allow more California home buyers to take advantage of the benefits of CalHFA’s affordable financing.
“CalHFA’s mortgage loans will now provide more low to moderate income families across the state with affordable opportunities to purchase homes with fixed-rate mortgages and down payment assistance programs,” said CalHFA Executive Director Claudia Cappio.
California’s homeownership rate stands at about 54.5 percent as of the end of the first quarter of this year, according to U.S. Census estimates, a full 10 percentage points below the national homeownership rate. California’s rate dropped from more than 60 percent before the Great Recession.
Studies also show that homeownership is linked to stronger neighborhoods, better educational achievement, civic participation and healthier outcomes. CalHFA’s lending programs provide unique opportunities for families to purchase homes, including:
- Offering a first mortgage for 97 percent of the value of the home, combined with a 3 percent built-in down payment second.
- Access to no interest and low-interest down payment assistance loans that don’t have to be repaid until the home is sold, refinanced or the mortgage is paid off.
- Combining with other CalHFA programs, including an energy efficiency grant for energy upgrades and federal tax credits that can reduce potential federal income tax liability.
All CalHFA lending programs require homebuyer education for future homeowners. Borrowers must also meet income and sales price limits that vary by county.
“As we mark National Homeownership Month, CalHFA remains committed to helping Californians purchase affordable homes,” Cappio said. “Homeownership is a cornerstone for our communities and economy. With these new efforts, CalHFA is working to remove obstacles that prevent Californians from becoming homeowners.”
For nearly 40 years, CalHFA, a self-supported State agency that doesn’t rely on taxpayer dollars, has supported the needs of renters and homeowners by creating and financing progressive housing solutions so more Californians have a place to call home.