The Federal Housing Administration (FHA) has proposed a new partial claim option for mortgages held by its Home Equity Conversion Mortgage (HECM) program. This measure would help struggling borrowers on the brink of defaulting on their mortgages by providing a one-time loan with differing repayment options.
Under the proposed option, FHA would provide a loan up to the amount of the senior lien for homeowners having trouble meeting the HECM obligations. The loan would not have to be repaid until the borrower moves, transfers title, or passes away, and the loan’s interest rate would be much lower than the rate of the senior HECM loan. In addition, the loan servicer would waive any accrued interest that the homeowner owes to the FHA.
Important Elements:
-FHA proposed a new partial claim option to support struggling borrowers
-Proposed option would provide a one-time loan up to the amount of the senior lien
-Loan would not have to be repaid until the borrower moves, transfers title, or passes away
-Interest rate for loan would be much lower than the rate of the senior HECM loan
-Accrued interest that the homeowner owes to the FHA would be waived by the loan servicer
You can read this full article at: https://www.housingwire.com/articles/fha-unveils-proposal-for-a-new-partial-claim-option/(subscription required)
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