HUD operates during shutdown; reverse mortgages hit maxOctober 7, 2013 @ 8:44 am
While the Department of Housing and Urban Development is maintaining some of its operations during the government shutdown, it has ceased to insure Home Equity Conversion Mortgages - the nation's most popular reverse mortgage program - due to a cap on the number of HECMs that can be insured by law.
Outlined in a contingency plan for lenders and other HUD partners spelling out plans for a lapse in appropriations during the shutdown of the federal government, HUD said while it will continue to assign case numbers to reverse mortgage loans, it cannot insure them.
"FHA does not have the authority to insure additional HECMs during this period due the statutory cap limiting the number of HECMs under the HECM Program," HUD stated in its contingency plan.
The agency is continuing to insure "forward" FHA loans and the home mortgage market continues to be active, especially in Seattle.
The number of September closed sales was up 26 over the same month last year, according to the Northwest Multiple Listing Service. The median priced home sold for $461,000 in September, up from $425,000 a year ago.
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