FHA ANNOUNCES REVERSE MORTGAGE FORECLOSURE ALTERNATIVE

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.

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