House Passes HR 3221
NRMLA (reversemortgage.org) 7/24/08 7:36pm
Late yesterday, the House passed HR 3221, the Housing and Economic Recovery Act of 2008, by a floor vote of 272 (yes) to 152 (no). This House version includes amendments that were negotiated since the passage of the Senate version two weeks ago. The Bill will now go back to the Senate for a vote and, assuming this passes without delay in the Senate, the Bill will then go to the White House for final approval. We believe there will not be any more amendments and that there is support for this version in the Senate.
The expectation is that the Bill will be approved by the Senate this week in a weekend session (although this can be difficult to predict). We believe Congress and the White House want this done before Congress (the House) begins a summer recess on August 4th. While the White House is not pleased with some aspects of the Bill, yesterday the Administration acknowledged the importance of the GSE provisions as a means to restore confidence and facilitate stability in the markets. Primarily for its interest in the GSE provisions, the Administration released a formal statement indicating that it would approve the Bill as amended by the House. This is a positive development and will help influence a positive outcome in the Senate.
As the Bill relates to the FHA HECM product, the provisions in the House Bill include:
1. A single national loan limit of $ 417,000 that can increase up to as much as $ 625,500 in high cost areas.
2. Home Purchase product authority.
3. Co-op product provisions.
4. Origination fees of 2% on the initial $ 200,000 loan amount and 1% on the balance thereafter with a cap of $ 6,000
5. Prohibitions on requiring the purchase of annuities and other financial products.
6. Restrictions around cross selling financial products.
7. Requirements on counseling protocols, funding and practices that promote independence and quality in counseling.
As the legislation passes through the Senate and becomes final, we will release a more detailed summary and analysis of the bill as it becomes final. In the meantime, we wanted to alert you to this significant milestone.
If you, family, or client is following this bill because you have previously been short to close on a reverse mortgage with today's lending limits, or would like to purchase a home utilizing the HECM (Home Equity Conversion Mortgage) please complete our online questionnaire by By Clicking Here We will keep you up to date on the progress of this bill and provide you an illustration of how much you may be qualified to receive once signed by the president
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