There are some new updates to keep and eye out for in the Reverse Mortgage world but none quite as big as the "new guidance releases for HECM-for-purchase market handcuffs." A new report shows that clarification has been provided by the Federal Housing Administration in their FAQs section.
“Properties are eligible for FHA insurance under the HECM for Purchase program when construction is completed and the property is habitable, as evidenced by the issuance of the ceritficate of occupancy, or its equivalent, by the local jurisdiction,” the notice reads, according to Reverse Mortgage Daily.
“The certificate of occupancy is required to be included in the case binder. Mortgagees may obtain the certificate of occupancy at any time prior to submission for endorsement.”
RMD believes that the last sentence "changed the H4P landscape in one fell swoop, and could potentially provide a solution for a program that’s always seemed as though it was perpetually on the cusp of gaining popularity."
So much has changed in the Reverse Mortgage world that experts are calling for a full-speed-ahead approach to educating originators and professionals on the changes.
That being said, the changes that have been made are receiving rave reviews from professionals like Dan Harder, vice president of 1st Reverse Mortgage USA, who believes the updates "simplify" the HECM for Purchase program and makes a more "flexible" program for seniors.
For more information on the new guidances, click on the image above.