[Federal Register Volume 80, Number 25 (Friday, February 6, 2015)]
[Notices]
[Pages 6743-6744]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-02452]
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DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
[Docket No. FR-5735-N-04]
Home Equity Conversion Mortgage (HECM) Program: Mortgagee
Optional Election Assignment for Home Equity Conversion Mortgages
(HECMs) With FHA Case Numbers Assigned Prior to August 4, 2014--
Solicitation of Comment
AGENCY: Office of the Assistant Secretary for Housing-Federal Housing
Commissioner, HUD.
ACTION: Notice.
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SUMMARY: On January 29, 2015, the Federal Housing Administration (FHA)
issued Mortgagee Letter 2015-03, setting out an alternative path to
claim payment--the Mortgagee Optional Election Assignment--for certain
HECMs. FHA issued this Mortgagee Letter pursuant to the authority
granted to it in the Reverse Mortgage Stabilization Act of 2013 and
Section 230 of the National Housing Act. This alternative path to claim
payment is necessary in order to ensure the financial viability of the
HECM program and the FHA insurance funds. The mortgagee letter was
issued for immediate effect and only applies to HECMs assigned an FHA
Case Number prior to August 4, 2014, where there is a Non-Borrowing
Spouse. This notice solicits comment for a period of 30 days on the
alternative option for claim payment announced in Mortgagee Letter
2015-03.
DATES: Comment Due Date: March 9, 2015.
ADDRESSES: Interested persons are invited to submit comments regarding
this notice to the Regulations Division, Office of General Counsel,
Department of Housing and Urban Development, 451 7th Street SW., Room
10276, Washington, DC 20410-0500. Communications must refer to the
above docket number and title. There are two methods for submitting
public comments. All submissions must refer to the above docket number
and title.
1. Submission of Comments by Mail. Comments may be submitted by
mail to the Regulations Division, Office of General Counsel, Department
of Housing and Urban Development, 451 7th Street SW., Room 10276,
Washington, DC 20410-0500.
2. Electronic Submission of Comments. Interested persons may submit
comments electronically through the Federal eRulemaking Portal at
www.regulations.gov. HUD strongly encourages commenters to submit
comments electronically. Electronic submission of comments allows the
commenter maximum time to prepare and submit a comment, ensures timely
receipt by HUD, and enables HUD to make them immediately available to
the public. Comments submitted electronically through the
www.regulations.gov Web site can be viewed by other commenters and
interested members of the public. Commenters should follow the
instructions provided on that site to submit comments electronically.
Note: To receive consideration as public comments, comments
must be submitted through one of the two methods specified above.
Again, all submissions must refer to the docket number and title of
the notice.
No Facsimile Comments. Facsimile (FAX) comments are not acceptable.
Public Inspection of Public Comments. All properly submitted
comments and communications submitted to HUD will be available for
public inspection and copying between 8 a.m. and 5 p.m. weekdays at the
above address. Due to security measures at the HUD Headquarters
building, an appointment to review the public comments must be
scheduled in advance by calling the Regulations Division at 202-708-
3055 (this is not a toll-free number). Individuals with speech or
hearing impairments may access this number via TTY by calling the
Federal Relay Service at 1-800-877-8339 (this is a toll-free number).
Copies of all comments submitted are available for inspection and
downloading at www.regulations.gov.
FOR FURTHER INFORMATION CONTACT: Ivery Himes, Director, Office of
Single Family Asset Management, Office of Housing, Department of
Housing and Urban Development, 451 7th Street SW., Room 9172,
Washington, DC 20410; telephone number 202-708-1672 (this is not a
toll-free number). Persons with hearing or speech impairments may
access this number by calling the Federal Relay Service at 800-877-8339
(this is a toll-free number).
SUPPLEMENTARY INFORMATION: FHA has a statutory obligation to ensure the
fiscal soundness of the FHA insurance funds and must take into account
the financial and administrative burden of any potential alternative to
claim payment that may be afforded to mortgagees holding any eligible
HECMs that were assigned FHA Case Numbers prior to August 4, 2014. FHA
also has the ability, pursuant to the Reverse Mortgage Stabilization
Act of 2013 (Pub. L. 113-29), to establish, by notice or mortgagee
letter, any additional or alternative requirements that the
[[Page 6744]]
Secretary, in the Secretary's discretion, determines are necessary to
improve the fiscal safety and soundness of the HECM program authorized
by section 255 of the National Housing Act.
FHA provided two alternative paths to claim payment in pending
litigation: The Hold Election and the Mortgagee Optional Election
Assignment, which are further discussed in Mortgagee Letter 2015-03.\1\
When analyzed in the aggregate, these options are costly; either
option, even if offered alone, poses a significant financial impact to
the FHA insurance funds. The Hold Election, when applied to the
potential universe of mortgages involving Non-Borrowing Spouses of HECM
borrowers, imposes a financial risk to the insurance funds that is
simply too great. FHA's obligation to protect the soundness of the
insurance funds makes it impossible to offer this option broadly. Even
though the Mortgagee Optional Election Assignment also poses a
financial risk to the FHA insurance funds, the risk is significantly
less; therefore, FHA has determined that the only alternative path to
claim payment that FHA will permit mortgagees to elect, pursuant to
Mortgagee Letter 2015-03, is the Mortgagee Optional Election
Assignment.
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\1\ Mortgagee Letter 2015-03 is available at http://portal.hud.gov/hudportal/documents/huddoc?id=15-03ml.pdf.
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In Mortgagee Letter 2015-03, FHA set out the Mortgagee Optional
Election Assignment path to claim payment for existing HECMs with FHA
Case Numbers issued prior to August 4, 2014. FHA alerted mortgagees
that aside from the present procedures for either the sale of the home
or foreclosure of the HECM in accordance with the contract as endorsed,
or the Mortgagee Optional Election Assignment alternative, no other
path to claim payment exists.
Comments on the changes announced in Mortgagee Letter 2015-03 will
be accepted for a period of 30 days and will be considered by HUD.
Dated: February 3, 2015.
Biniam Gebre,
Acting Assistant Secretary for Housing--Federal Housing Commissioner.
[FR Doc. 2015-02452 Filed 2-5-15; 8:45 am]
BILLING CODE 4210-67-P