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S. 2338, The FHA Modernization Act of 2007
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Visitor Comments
John
FHA reform is way overdue. Senator Coburn should read the bill before coming back from the two week recess and limit the debate.
Robert Hurd
FHA Modernization Act of 2007 is very important to this country and must be passed by the Senate. FHA is more important now to this country's financial stability and to home owners needing help, than it has been in the past 70 years. The Senate should have passed this legistation soon after the House passed HR 1852. We need the President to urge the Senate to get with the program and not delay in passing this bill so the President can sign it into law. Our economy depends on it!!
Don Marginson
I am a Mortgage Broker, 30 years in the business. I have never been a sub-prime lender. My office has stacks of loan files that we have no loan programs or lenders available for.
These loans are not real estate speculators or flippers, but they are the average American home-owners wanting to keep their American dream!
Approximately 500,000 home loans will re-set in the 1st quarter of next year. If these homeowners must default that would be approximately 750,000 American children that will no longer be able to go to their same schools, play with their neighborhood friends or attend their same Church or Synagogue.
These families will be financially ruined. You cannot even rent a home without a good credit history.
This is not about Mortgage Broker’s staying in business or how much money they make. This is about the American Homeowner.
Phil
The Senate let a similar bill die last year due to neglect. They seem to be doing the same this year. I think what we need is new senators one and all. Dem or rep doesn't seem to make a difference, they all think they are crown princes instead of our representatives.
Gloria La Mantia
I have e-mailed Senator Tom Coburn to not hold up this bill. I have not heard from him. I also e-mailed President Bush,no news yet. However I did hear from Scott Meyer from NAHB.Plese e-mailSenator Tom Coburn for action.
Mary Ann
When, I ask, when will the Senate move on this. Time is running out.
Gloria La Mantia
The Senate voted on S2338 today,December 14, 2007 at 9am and the vote was yea 93 nay 1. We will see how long it takes to have The President sign it into law. Senator Tom Coburn had a lot of good points. This was on c-span channel 351. Thank God! for all the prayers.
Mary Ann
You just made my day. I will not stop praying until it is a done deal.
Josephine Ruvalcaba
I am overjoyed to see that the Senate voted to pass bill S2338. I e-mailed Senator Tom Coburn and I also Faxed his offices in Oklahoma and Washington D.C. urging the Senator not to stall, and to proceed to pass this important bill. I have not received a reply from his office as yet. I understand that Bill H.R. 1852 has recently passed and I'm thankful for that also.
Bryan Ehrlich
I emailed Coburn and my Florida State Senators. I asked Coburn to Legistlate rather than vegitate. I think all of our emails may have had some influence.
Evan Little
What we need to do is stop allowing the Federal Reserve Bank to print money out of thin air. Stop the private bankers who own the Federal Reserve from adjusting the flow of money to suit their own needs on the back of tax payers. This is why both parents must work to support a family now, why the dollar is falling and why you're supporting an increase in the FHA loan limit. But hey, ignorance is bliss right? WAKE UP!
Tory
This is ridiculous! I can't believe you are okay with bailing these people out of their situation. What ever happened to individual responsibility. It is the lenders fault for lending to people who they knew could not afford the house that they are getting. We need mortgage reform and elimination of these types of loans. Oh, so maybe they lose their house, boo hoo. Get a grip. The US is going into debt at a rate of 1.9 BILLION dollars per day because of stupid legislation like this.
Terry
Evan, you are right on point. I am a mortgage banker and not totally opposed to FHA reform, but agree that in the end, the tax payers will suffer more at the hands of the FED. This whole mess rests on their shoulders. We need some honest money first and foremost.
John
FHA is not a subprime bail out. It requires borrowers to verify income and assets. It has credit standards. The borrowers must qualify and their properties must appraise. If a subprime borrower is behind on the mortgage payments then the only program available is the FHA Secure program (already available). Still they must document income and assets. Many of these borrowers owe more then what FHA currently allows. The FHA Reform Bill will help on this one issue. All the hype on how FHA is coming to the rescue is just that. Relax.
Tom
Reform is way overdue. Because FHA was behind the times is the big reasaon the secondary market grew into the monster that finally reared its ugly head in August of 2007. Government is not always the answer to peoples problems, but in this case where it has been a keystone to the purchase of homes in our country change will be good. The changes may not be perfect but it will put FHA back in the market again.
Frank Farmand
I have been a Mortgage Broker since 1984. The Reform is way overdue. The penalty for Fraud (by companies, banks or loan officer’s) must be a lot tougher. We do need to add more Federal Regulations to control Loan Officer’s working for Banks or Mortgage Broker’s. Any one who touches a loan application must meet and follow certain Federal Rules and Regulations. For example, some States including Missouri, ex Con-Man with records, can be a loan officer and work for a Bank or a Mortgage Company. We do need to add it to the Bill and implement it nationally.
Trojan_Large
Did this bill get pass ?
Carol
It has passed the Senate, but not the House.
John
S2338 Passed in the Senate 93-1 but today 01-15-08 conference committee of House/Senate conferees must be picked to compromise on the House and Senate versions of the FHA REFORM. Lastly the President will sign hopefully before the State of the Union Address.
bennettjohn
here's another point of view. i'm a senior trying to get a reverse mortgage on a home i've owned for 24 years. it FHA appraised for $305,000 but my county FHA limit is $200,160. the new federal limit will be prox $414,000 and be national in scope. the current limit is archaic, obsolete, and out of touch with current market prices.
i agree, reform is long overdue.
if s2338 passed 93-1 on 01/15/08, why does the "latest major action" state 12/17/07 "held at desk"?
bennettjohn
man, oh man, is that code difficult to read, or what! it took me 3 tries before it accepted it and posted my comment. we've all seen other variations that are much more user friendly. i wonder how many folks have tried to post comments but been rejected by an indecipherable cryptograph.
John
Sorry if I confused you about S2338. It passed in Senate on December 14th. It has been held since then. For almost a month Congress has been in recess. They returned on 01/15/08 and now need to pick House/Senate conferees.
Cathy
How can I track what is happening with this bill in the House, since it's done in the Senate? I'm trying to watch it and estimate timing...for when it might go into effect.
John
Follow press releases of Barney Franks. He is chairman of Financial Services Committee.
Jason
Once signed into law, how long for lenders to implement the changes and actually start granting these higher loan amount loans? Days, weeks, or months? Any thoughts?
Trojan_Large
I am wondering have the house pass the this FHA bill or close to it ? I was hoping that this bill will get pass before the end of Jan. I am not seeing a clear date on Barney Franks site. Can someone update us on a good site to check this. Thanks
John
The FHA Reform bill is now part of the Presidents stimulus plan. It has to be approved in the House. Maybe a vote by end of January. Then to the Senate for a vote. Hopefully they act quickly and we get a vote. Finally to the President in mid February. It will be worth the wait if FHA loan limits go to $730,000 like they are saying in high cost area.
Charles
Reality: With all the first time home buyers programs being denied by bank underwritters,the minimum down payment realistically available today is 10%. If FHA does not come for a rescue as soon as possible, then the house prices are going to drop even much more drastically and number of sales will decrease to catastrophic levels. We need action, now!
Brian
My understanding is the bill passed without the inclusion of brokers being able to obtain a surety bond instead of a financial audit. Is this the case? I have not been able to find the answer yet.
Frank
I understand that the loan limits will be raised higher than $417,000.Will thia help someone who wanted to take out a reverse mortgage if you were short before.Our that won't change. Thanks
Trojan_Large
Will this be for the state of NC ?
Gerry
If Wall Street just taught us about "modernization" with the sub-prime debacle, why is everyone suggesting FHA should "modernize" too? The Wall Street model clearly failed and for some reason we want HUD to follow sub-prime off the cliff by adopting subprime's fatal flaws, e.g. no money down.
House prices rose based on cheap money coupled with "fog-a-mirror" underwriting. These inflated house prices are predicated on fantasy financing. The fairy tale has now turned dark.
bennettjohn
today, 1/31, the senate will pass a stimulus package over and above what the president worked out with the house. i agree with you, john, it'll go back to the house and be passed in a few days, with the president signing it promptly. also, john made a good call back in late december when he said it would be included in the state of the union address. that was before the term "stimulus package" was in the headlines.
Lorenza
In Jan.2008 I faxed letter to majority leader Hoyer and copied nancy Palosi,Diane Feinstein, Babara Boxer & Jerry Lewis (Speaker of the Hs, 2 Senators & 1 Representative respectively) urging passage of S2338 Expand'g American Homeownership Act of 2007 as since pasage by the Senate Dec. 2007 as Bill was sent to the house to correct descrepancies between their Bill H.R. 1852 and Senate Bill S2338. To date, 2/2008, Bill sits idle. Majority Leader has not assigned conferees nor placed on Agenda for study, modification, review and presentation to vote on it. Why does our government not finish what is started before going on to other issues/Bills?
John
02/05/2008 S2338 "still held at desk" Many House members thought that the stimulus package would include the FHA Reform bill as did I, but on the White House urging it was left off. Last week Pelosi made a comment that she thinks S2338 FHA Reform will be ready for Bush signing before the stimulus package because of the Senate adding more to the House version. Besides the stimulus package debate, FISA and the Farm bill, we will be luck if S2338 is ready for Bush to sign by 15th of February.
joseph
Many homeowners are anxiously awaiting the change in raising the limits for reverse mortgages detailed in SB S2338. This is a much needed program to help our seniors to use the equity in their homes. Pass the stimulus bill !!!!!!!
Naples
Will the new loan limits help on a reverse mortgage if you still have a balance.
Jim
The increase in county limit may indeed allow many seniors who had 'low' reverse mortgages the opportunity to refinance.
John
Unfortunately "Dr. No" Senator Coburn won out and had FHA reverse mortgages removed from the temporary increase in the loan limits of the stimulus plan. We need to refocus on S2338 FHA Modernization Bill. Call your congressional and senate representatives and let them know they need to complete the compromise and get it to Bush to sign.
Bob
To those who are concerned that their tax dollars are going to pay for some sort of government sponsored "bailout", you should be aware that FHA is NOT funded with taxpayer dollars. Per the FHA website at fha.gov: "FHA operates entirely from self-generated income and costs the taxpayers nothing. The proceeds from the mortgage insurance paid by the homeowners are captured in an account that is used to operate the program entirely.” To those who are concerned that raising the FHA loan limit is a risky idea, you should be aware that borrowers are required to prove their income (IE: document their income and prove that they can afford the mortgage) in order to qualify for an FHA-guaranteed loan. So, even at the higher loan limits, borrowers should not be at risk of getting into a home they cannot afford. This is not a tax payer bailout and it’s not too risky. It is good legislation. Pass the bill!
Trojan_Large
Hi, does any know how long it takes for the new loan limit to go in to affect ?
Dan
Tory should take a chill pill. Bob is accurate. This is not a bailout. FHA(203/703(b))pays for itself. Always has. FHA loans perform because income/assets are documented. Previous limitation was 48% of conforming. Way overdue for a change. T-L, FHA reg changes are implemented typically 30 days after publication of the new law - figure 3/13/08. FHA is in the process of providing updated median income data upon which the new loan limits will be based.
George
Because of the stimulus bill,is the fha modernization bill dead? It hasn't been reconciled yet. Is there any movement?
Dan
I have been doing FHAs since they raised the loan limit from $35K to $60K back in the mid '70s. FHA doesn't seem to do more than one thing at a time. On the other hand, when they make a change it is typically pretty significant. I've heard nothing further on the reconciliation but I don't think it is dead. Because the stimulus package addressed loan limits, which was a major focus, they might set this aside and address the MIP vs Credit Score, lowered down pay and more permanent loan limits later in the year. More immediatedly I am curious to see if there is enough congressional support for maintaining the Ameridream-type DAPs beyond this month.
Rex Davis
The key is get it PASSED and quit playing around with it so that those of us who can benefit from it have the chance before we DIE.
Naples
Why was the FHA reverse mortgage removed from the stimulus bill.are they still talking about it.or is it dead.Like some of us might be before it's passed !!
RUDY
I heard this bill has been passed.Does anyone know where the bili sits currently? Also how long before we see the changes in FHA
John
2/29/08 FHA Modernization bill not yet passed. Saw today that House & Senate resolving a few more differences such as maximum loan limit. Regarding the temporary loan limit, possibly March 7th.
Francella
When is this bill going to get passed, go to joint committee and signed by Bush? We wait and wait and wait, and in the meantime foreclosures just keep mounting up and up and up.
I'm sick of the foot-dragging on Capitol Hill. People need this. If just one House or Senate member was in the position of any number of my clients - this Bill would be OVER...a done deal!!! Is there a Foreclosure Lobby? Because that group is making money hand over hand on the backs of honest homeowners. Congress needs to get the lead out!!!
Frank
Just the older people that this bill will help by just raising the loan limits should be enough to make them move swiftly on this.Is there any site that you can follow this bill.The NRMLA wiil only tell you if your a member.
Ryan
John,
How are you able to track? I have a loan pending on this legislation, so I'm very anxious!
John
Ryan, Be patient it may still be a few weeks before it gets to the President. Try GovTrack.us, financialservices.house.gov or CQ Today.
Gloria
Bill is currently in conference committee.Comprimise bill,then back to each chamber of Congress then sent to the President for sigature, then a formal rulemaking process needs to take place before the bill could go into effect. My Aunt will be living on the State by that time, whenever that is.
Patrick O'Neil
The 1996 reform of The Fair Credit Report Act (FCRA) allowed lenders to make "conditional offers of credit" to consumers. This gave sub-prime lenders the ability to access the credit bureaus for lower credit-scored prospects and then they started making the refinance offers without having to extend a "firm offer of credit" to the consumer. The revision of the FCRA regulations and FHA's inability to come up with loan products to stay competitive created the sub-prime market and the mess we're in today.
Robert
We need AARP to flex its lobbying muscles in Washington and get these 2 bills reconciled and out of conference committee, acclaimed by both houses and on the President' desk. Email AARP and the National Reverse Mortgage Lenders Assocation to volunteer and request information on how to support this measure, etc
Mortgages in Reverse
It is unbelievable how the "foot-dragging" and procrastination in Congress drags out these bills for such a long period of time. Seniors "near" foreclosure are holding their collective breaths waiting for this legislation to get to the White House to be signed into law. Maybe they are waiting for the "new" president to receive the accolades from its passage -- and not our current CiC.
Gary
Finally, someone has the sense to
amendthe FHA regs to include us
Seniors in manufactured housing who live in a "condominimum" setup
We own the land, are on the tax rolls, but because we also own a
part of the whole community, we
are denied a reverse mortgage.
Unfair, and overdue to be overhauled! Get it passed.
Nancy
Having read John's comments to Ryan about being patient, I went to the 3 sites he recommended (GovTrack.us, financialservices.house.gov or CQ Today)and could not seem to find anything with a recent date. When did Gloria post her comment that the bill is in the Conference Committee?
John
03/13/2008 For the last four days I have read that the conferees in the House and Senate have been meeting and are very close to an agreement. The last issue is on the loan limits. On the GovTrack.us web site it does not show that it has been looked at "still at the desk". Barney Franks quoted as saying they are very close to an agreement. Chris Dodd says that they have to dot their I's and cross their t's. He says that before this Friday we will hear something but final agreement will not be until early April. (Another recess for Congress)
Patricia B.
Again I am amazed at those who are lucky enough not to have to use this type of refinancing. It has saved my life and my home. This has nothing to do as implied by some with "irresponsibility." If there was more room to write, I would fill up pages regarding insurance company's fraudulent behavior and irresponsibility which I have personally experienced due to no fault of my own. A thankful widow!
bennettjohn
john-
keep coming with the updates. you seem to have a firm grasp on how the govt operates. most of us out here are mystified. many of us are seniors who merely want a reverse mortgage based on our true equity in our home.
thanks for your continued explanations and updates.
webmaster
Agreed. Thank you for your service to the WashingtonWatch.com community, John. You might consider editing the wiki article for the bill so that a thorough, organized discussion of the bill and its status is always available.
Information on editing can be found here: http://www.washingtonwatch.com/wiki/tutorial/
Anti-mortgage brokers
Isn't it humorous that mortgage brokers want FHA to increase loan-to-value so they can continue to hyperinflate properties values and pocket excessive fees.
John
There is nothing humorous about people losing their homes because they had no options available because FHA loan limits and policies were behind the times. Subprime and Alt-A programs skyrocketed while FHA dried up. The ignorant comments about mortgage brokers has no place here.
bennettjohn
i concur. in fact s2338 actually reduces commissions from 2% of a home's appraised value to only 1 and 1/2%. how does a reduction of brokers' commissions equate to "excessive fees?"
i have a choice to either sellout or to borrow operating expenses until s2338 becomes law. i have chosen to borrow the necessary funds on a month by month basis. my neighbor just sold out for $370,000 because the county FHA cap is $200,160. Yes, the FHA caps are obsolete and in need of updating.
John
04/02/2008 Senate housing relief bill may now include the FHA Modernization Bill. Details still coming in. Hopefully Senators do not add to many amendments.
beth
thanks for the update, John. I'm keeping my fingers crossed!
Robert
John,
On 3/13/08 you indicated that final agreement was close in the Conference Committee. Attaching the bill to preliminary Senate housing relief bill is a major step backwards, isn't it? Were we not a few days from a final agreement going to both houses and then onto the President signature (Bush has stated he would sign the bill)?
Relinquishing the final agreement is a giant step backwards into uncertainity and months of possible delay. Why is the Congress ready to cancel the conference committee's progress on the final agreement?
ROBERT
I CONCUR , "THANKS AGAIN" John
for the update ....
John
This new bill will be fast tracked through both Senate and House. The last issues delaying the FHA program have been resolved. $550,000 loan limit and 3.5% down payments.My guess is that President will sign by April 15th....
Jamie
John,
Please keep the updates coming. I have many clients doing everthing they can to hold on so they don't lose their homes to foreclosure. s2338 is they only chance they have of remaining in the home. I talk to many of them weekly and it's frustrating when I have to tell them the status hasn't changed. Thanks again for all the good info and for this posting site.
Lisa
The current FHA down payment (borrower contribution) is 3%. Are you under the impression that they are going to increase it to 3.5%? I thought it was supposed to go in the opposite direction?! By the way, thanks for staying on top of this and providing updates, John.
Robert
Dear John,
I have been following the Senate version of the new housing reflief bill. As far as I can see, there is absolutely no mention of HECM (FHA reverse mortgage) borrowers. Remember, the Economic Stimulus Package specially excluded HECM (FHA)borrowers. If this new bill supercedes S.2338 and its companion bill in the House and the "near final agreement" of the Conference Committe is scrapped--THEN MILLIONS OF SENIORS WILL DISENFRANCHISED FROM FHA MODERNIZATION BENEFITS AND RELIEF FROM OUTDATED REGULATIONS. John,please reassure me that this is not going to happen.
John
The website: www.senate.gov Next find HR3221 Next S.Amdt.4387 then text of amendment. It will reassure you that it will happen this time. FHA HECM's are a big part of the Modernization Bill. Curious to find out if $417,000 will be the sigle national HECM limit or will it be $550,000 in high cost areas like SoCal
Jim
Dear John and Robert:
I have read both of your posts and can not determine who is on the mark. This is the most confusing and convaluted piece of legislation that I have ever seen. Calls to my local congressmen confirm this! They don't know what's going on (they don't tell you this)but I get this feeling because they can not answer whether or not the HECM increase of the county limit is actually in the legislation
BILL
Would someone "PLEASE" advise if the housing relief bill that just
passed the senate includes the FHA
HECM Moderization Bill ...
THANK YOU EVER SO MUCH FOR YOUR HELP !!!
John Coe
Bill,
Yes it does. I don't know the specifics, but my info tells me a flat 550k lending limit. 2% origination up to 200k with a 1% orig after that, to a max cap of $6,000 total origination. Still digging through the mess to figure our when this will actually fly.
BILL
JOHN:
I Thank You for this information ..
You have been a wonderful "GOD SEND" with your updates & comments
PLEASE keep them coming ..
THANKS AGAIN !!!!
Robert
4/12/08HR3221 passed the Senate yesterdasy..incl. Dodd admendment for FHA modernization and HECM reform. Now, correct me if I'm wrong, the bill goes to conference committee as the House already passed this bill. The White House has stated 1)it will never get out of conference committee 2) they are unhappy with it 3)but have never specifically said Bush will veto. WHY CAN'T BOTH SIDES OF THE AISLE IN THE CONF. COMMITTEE AND THE WHITE WORK THIS OUT NOW! Dear John Coe, can this happen?
Jo Ann
Along with countless others, I am not so patiently awaiting for this bill to become law!
In fact, I am in limbo with a RM in thge works, but do not want to proceed until the loan limits are raised and, of course, the other aspects of the bill are a plus.
Writing to my Senators/Congressmen - anyone I can. Hopefully in this election year, we will see results.
John
04/14/2008 The FHA Modernization Bill is now part of the Foreclosure Prevention Act which was passed in the Senate on April 10th. The House and the President oppose key parts of the Senate measure (not the FHA Modernization portion). They feel that builders are getting to much help and people facing foreclosure are not getting enough. They plan on correcting that imbalance. House Financial Services Chairman Barney Frank says that by April 23-24th his panel will consider the plan. The FHA portion of this bill is about the only thing that all sides agree on. The last two issues, loan limit and down payment have been resolved. I now believe that the FHA Modernization Bill should never have been made a part of this foreclosure bill. It will pass in the next few weeks. There is lots of pressure on all sides to delay it much longer.
Robert
04/14/08 Dear John, Allright we have FHA Modernization "stuck" in HR3221. Why can't go back to HR1852 and S.2338, pull the "final agreement" out of conference committee and give it to Bush to sign. Once the President signs, S.Amd. 4387 can be dropped from the contentious HR3221 which could easily self-destruct anyway.
John
Robert, Today President Bush asked that Congress send him the FHA & GSE Reform Bills (three times) in his speech. It's unlikely that FHA Modernization would be stripped from the Foreclosure Prevention Bill now. But it sure would be nice.
Jim
Fyi…..
NRMLA Washington Update: March 2008
March 11, 2008
FHA Modernization Legislation Moving
NRMLA has learned that lawmakers have negotiated a final version of the FHA Modernization bill (HR 1852, S 2338) that retains many important reverse mortgage reforms.
Once a bill is formally adopted by the Conference Committee, it will be sent to both chambers of Congress for approval before its sent to the President for his signature.
Robert
04/17/08 Jim, it would nice to be able to turn the clock back. But as John and I understand it, the FHA Modernization is stuck in HR3221. All this occurred after March 11th. Read exchanges previous to yours.
BILL
JOHN:
I dont know if I have ever been on a roller coaster ride (with out the
thrills ) like this FHA modrnization bill .. would you please advise . what do you know think of HR 3221 now passing into law !!! ???
THANK YOU ....
Jim
I have passed on information recevied from the National Reverse Mortgage Lenders Association. I have to assume that they know what is going on.
Check their website. thanks
John
Jim: The info from NRMLA is old news. I get periodic updates from them myself. Sometimes they are wrong. I cross check their info with many other sources. Next week April 23-24th Barney Franks House Finance Chairman will hold hearings on S3221. It will get passed soon.
John
Correction: Barney Frank hearing on HR3221 Foreclosure Prevention Act of 2008 not S3221, which includes S2338 FHA Modernization Act 2008.
Jo Ann
I realize no one has a crystal ball, but does anyone know that if HR3221 is passed - signed into law - how long does it take for HUD to implement the provisions pertaining to HECMs?
I am on the brink of having to decide whether or not to close on a HECM 100 OR wait for higher limits (a higher loan amount) plus perhaps other beneficial changes.
A real dilemma! Would it be worth it for me to give up a 1.0 margin and have to settle for a 1.5 in order to obtain more money?
ANY help from the experts most welcome!
John
Jo Ann: The way Congress is going and the fact that HUD has to do it's thing afterwards I'd say you are five to seven weeks away to be able to fund a Hecm at the new loan limits. Also the HECM 100 is already a thing of the past. Verify if it is still available. CW and FF no longer offer the 1.00 margin. The one benefit of closing now is that home values are coming down.
Jo Ann
Thanks, John.
I appreciate your response.
I'll hvae to decide quickly!
Robert
04/21/08 Dear Jo Ann, only B of A still offers the HECM 100. After 4/24 they will no longer accept that product. Fund it as a HECM150 asap--a bird in the hand is better than one in the bush!
Johnny Blazzze
Hi, I am running out of hope that the FHA Modernization bill will ever get passed. Please let me know if this bill really is moving. Thanks
Jim
Hi Johnny you are truly a voice in the wilderness.
I am thru trying to figure this on out..I give up!!!
BILL
424
JOHN: Do you know if Barney Franks
has held hearings this week on
S3221
THANK YOU !
John
Bill, Franks held hearings on a mark up bill HR5830 on foreclosure assistance. I believe he might want to see if he can get more support to attach it to HR3221 Foreclosure Prevention Act which includes S2338 FHA Modernization. Have not found any mention of conference committee on this bill. I wrote both Nancy Pelosi and Barney Frank's office to not mess up things by adding to it. Everybody needs to write them.
BILL
JOHN:
Thank You for the reply, I will
write to both as you have indicated..
PLEASE keep the updates coming ..
Jo Ann
Am I correct that HR5830 passed the House? Next? and is the part re: RM loan limits still in there? Anyone know? So many questions!
chidembo
Yah! Everyone is mum about Reverse mortgage legislation nowadays. Where is rh3221? Does anyone know up to date news about the FHA Mod. Act which includes Reverse Mortgage? Thanks.
Jim
I believe that the bill which passed the Senate yesterday contains most of the provisions of the original S2338. Go to http://www.govtrack.us/congress/billtext.xpd?bill=h110-3221 and see sec122. I do not see increase in county limit
John
05/08/2008 FHA Modernization is not finalized. In the House debate this week in HR3221 Foreclosure Prevention Act, Barney Frank is proposing that the temporary limits be made permanent and that the single national limit for Hecm reverse mortgages be $550,000.
Easier to read
Just click on the "read the bill" link above to see the actual copy of the bill from Congress.
John
HR3221 passed in the House today with Barney Frank and Maxine Waters foreclosure bills. Now some behind the scenes negotiations with the Senate and White House over these additions before it goes back to the Senate for a vote. Hopefully they compromise and we put this FHA reform bill to rest.
BILL
5 8 8
John Thank You once again for your
concise update ,(as always ) ..
please continue with any further
news ..
BrianF
What if the President vetoes the Bill?
Betty
The Government certainly does not understand. Our families will be financially ruined. The Government needs to act on this bill.
John
05/13/2008 Today I read that on Thursday Chris Dodd in the Senate will bring up the FHA foreclosure and GSE reform bills for mark up. This time around Republican minority leader of the banking committee Senator Shelby is "the road blocker". Without White House intervention this guy could stall the FHA Modernization. Please call his office and let him know how you feel about this issue.
Robert
5/14/08 Can someone explain this to me? Bush wants FHA Modernization and has asked for the bill in public speeches numerous times. Barney Frank and Christopher Dodd want FHA Modernization. Most Republicans seem to want it viz. HR 1852 (last year). THEN WHY DON'T WE HAVE A LAW? Barney Frank takes his Foreclosure Prevention measure and attaches to it FHA Modernization and GSE Reform and, in effect, dares Bush to veto it. Rome is burning and Congress is fiddling and pointing fingers. System gridlock is killing FHA Modernization. It makes one dream of a more efficient SYSTEM!
bennettjohn
it was interesting to see you use the rome burning, nero fiddling metaphor, robert. i used the same one in my email today to sen. shelby as john, our fearless leader, requested. i hope hundreds of folks joined me in letting him know thousands of seniors are waiting for a national FHA limit.
Jo Ann
I wrote to Senator Shelby regarding how important this legislation is to everyone and to me - a senior waiting for FHA raised loan limits.
Reminded him of elections and the grey vote.
BrianF
I'd still like to hear your thoughts out there. If Bush vetoes, as he's threatened, what are the next steps?
Robert
Is FHA Modernization in the Dodd-Shelby compromise or not? 5/17/08
Jo Ann
5-21-08 Let's hope the FHA Mod is still included!
Why so many bills are combined makes no sense and it really jeopardizes indivisual bills when there is a difference of opinion.
Does anyone know if HR3221 is still in there for sure?
John
Yes, FHA Modernization and the GSE Reform are the plums the Dems know the White House and the Republican minority want passed. The other parts of this massive bill are there to grudgingly get them to sigh off on. Senator Shelby is finally on board with some minor adjustments on the House version of the bill. Next full Senate vote then back to conference with the House. Hopefully to the President for signature by July.
Jo Ann
Thanks so much, John! Your input most appreciated.
Carrie
Hopefully to the President for signature by July? Didn't we hear "hopefully to the President for signature by December, by January, February, March ..."? How many seniors have lost their homes in the meantime? How many could have stayed in their homes if they had the money to do the renovations needed to make it safe for them? To bring in help? To make their quality of life go up? How many are now in nursing homes, on federal money (medicare/cade) who could have still been in their homes? The FHA modernization act is needed, it is needed now to preserve the quality of life our seniors deserve and save expenses that drain us going into nursing homes for minimum care, as people are shelved waiting to die.
karen
How much longer will we seniors have to wait? If not passed soon, I will lose my home and all the money I have put into it. Doesn't the Congress realize we seniors will use some of our HECM money to stimulate the economy by purchasing the things we need and doing improvenents to our homes? I keep hearing 6 more weeks, but I have been hearing this since last year. Now I hear they are suppose to vote again before the July 4 recess? Any news?
John
5/28/2008 The FHA Reform bill is now part of "The Federal Housing Finance Regulatory Reform Act of 2008" just in case anybody was keeping score.
BILL
Thank You JOHN for this update
(and I am trying to "keep score")
Please continue to keep all of us
informed ...
karen
Yes, a big thank you, John. It is difficult to "keep score" with all the different numbers being assigned as this bill makes its way through the maze. Please keep up the good work!
Nancy
Question regarding John's information that the FHA Reform bill is now part of "The Federal Housing...." Is that a good thing or does it muddy the water even further?
karen
Good question. I have beem trying to get some info on the FHFRR Act of 2008 and find it was passed in the Senate.....so not sure where it stands now and if that version included the FHA Reform Bll or where it stands at this point. We sure don't need to have more "muddy waters" at this point.
paul
can anyoneestimate the differance of taking a reverse mortgage now vs fha reform bill, if passed
bennettjohn
paul- in response to your question...
yes, i'll try to answer it for you.
i'll use my figures as an example.
today, the FHA cap or limit for an HECM in my county is $201,600. since my home appraised for $280,000 i can apply for a $201,600 reverse mortgage. if my home appraised for $180,000 i could apply for a $180,000 reverse mortgage.
if the FHA reform bill is passed, a single $417,000 national, not by county, cap or limit is being considered. i would be able to get $280,000 vs. the current $201,600. for me, the difference is $78,400.
that is why so many bloggers on this site are at wits' end waiting for congress to pass it. i hope this helps explain our anxious behavior.
Robert
Attn: bennettjohn. To be fully accurate on your assessment, remember you would receive 40% to 60% of the $78,400 difference depending on the age of the youngest borrower and interest rate prevailing.....
paul
thanks so much bennetjohn and robert for your prompt responce. It seams waiting would be wise, however I have waited over year, and there has not been alot of progress. I suppose at some point I will have to say "GO FOR IT". Again thanks to you both. your info is very much appreciated
bennettjohn
correction noted, robert. you ARE the man!! if you can hang in for a while longer, paul, it may be worthwhile. we're expecting a resolution before the july 4th recess. keep in mind that every other deadline we anticipated was incorrect, and just another continuation of this drawn out process.CF2IP
John
Many borrowers have been waiting since July 2006 when the House first passed HR5121 The FHA Reform Bill. Unfortunately home values have come down and many no longer can benefit from the higher loan limits by refinancing into an FHA Hecm. In hindsight many seniors waiting for a reverse mortgage should have done so already. On a positive note many lenders have been pressured to drop their fees. To bad it is taking an act of Congress to do so, however so slow.
Jamie
John, I agree with you. I have many borrowers who wanted to wait for the limit increase to get more and now with values down, they really won't benefit much. I agree with the fees dropping, I have started advertising that I guarantee the lowest closing costs and $25 on servicing for HECM products. There is plenty to be made, no need to ask for top dollar. Hopefully these these guys in DC wake up soon!
paul
Jamie, perhaps I am somewhat confused in regaurd to waiting and perhaps if I gave you figues it would clarifiy things. my home recently appraise at 330000. I owe 75000 on the property,currently I can qulify for 230000 on a hecm in my county. how would I benifit, if at all to wait for possible passage of the bills now in congress. any comment is welcomed, thanks so much
Jamie
Paul, first you must know what the lending limit is in your county. If it's below $330,000 then you may qualify for more if the proposed lending limits were to take effect. If the lending limit in your county is currently at or above the $330,000 then there is no benefit to waiting. With values decreasing and not knowing what interest rates will do in the near future, you need to evaluate your situation to see if it's worth waiting on legislation for a lending limit increase or if you benefit from the HECM Reverse today. I hope that helps.
karen
Thanks Jamie for your explanation. My county limit is only $226,100 but my home appraised for $320000. At 66 what is the maximum I can hope to get by waiting for the increase? Since I presently owe $150,000, the current levels would require me to bring about $20,000 to closing! I have no choice but to wait this thing out or try to sell. Do I have it right?
Jamie
Karen, based on your age you would be able to qualify for about 60% of the home value or lending limit (whichever is less). At $226,100 you qualify for $135,660 and at $320,000 you qualify for $192,000 so there is a benefit to you if the lending limits were to increase at or above $320,000. These are just rough numbers so please hold me to it if I am off a bit. Hope that helps to explain.
karen
Thanks so much, Jamie - rough numbers are better than none and at least it confirms what I was thinking........you have been so helpful! Now, if only Congress would "get it done."
Franny
John, Do you know if the new "FHFRRA of 2008" still includes Making Manufactured Homes in Condominium or HOA's eligible for Reverse Morgage?
John
Franny, FHA Modernization Bill is one of the main components of this massive bill. The only thing that I know of that the Senate committee has changed is regarding the affordable housing fund in the House version. Senator Shelby wants this fund to be used to pay for foreclosure amendments that have been added. Not the taxpayers
paul
Just a thought to the fine people who are keeping this feed going. If presiednt Bush allows this to drag on until he is out of office how do yoy feel the next administation would react be it republican or democrat.
Franny
I don't think it is the President that is dragging this bill on, it is our congress. I think either canidate will have a favorable view of this bill.
brianf
I'm a bit confused here. Does the FHA Modernization that is now in FHFRR Act of 2008 have a proposed limit of $417.000 or $550,000?
John
Brianf, House version $729,750, Senate version $550,000. Article in Washington Post 6/7/08 by Jeffrey H. Birnbaum should clear things up.
paul
John, thanks. Looks like you are really on top of this thing. It does seem to me that the media, at least the tv media does not see this as worthy information to pass along, especialy when you consider how many Americans would be effected. Coments from all or any would be much appreciated.
Robert
John, Reverse Mortgages were specifically excluded from the Economic Stimulus Package. Many think, in part, since a 2% origination fee on $729K would exceed (as would initial MIP?). Since they are debating the $729 and $550 national limit, could we be wiped out by this consideration again? I thought the origination fee was reduced to 1.5% as part of the Dodd package? Please advise.
John
Robert, There is no opposition to the reverse mortgage program in either side of Congress. Remember the origination fee unlike the MIP IS NEGOTIABLE. Shop while you wait for the bill to pass.
karen
John is correct - origination fee is negotiable and anyone that tells you otherwise does not have your best interest at heart - only their pocketbook.
Robert
Dear John, maybe I did not make my point clear. The issue is not the negotiability of the Origination Fee. The issue is with a 2points of lending limit cap and a lending limit of 729K, the senior could, theoritically, be charged $30,000 for a HECM. This is why I brought up the Economic Stimulus package, which excluded reverse mortgages, and Dodd's alleged reduction of the 2% origination fee cap to 1.5%. One of the reasons the economic stimulus package excluded reverse mortgages was because legislators found a $30,000 maximum loan fee to steep for the senior. Will this issue arise again in the current debates about the lending limit?
John
NO
Marie
I find that most of the discussion is on the lending limits of this act. Do you all know that Seniors who own Manufactured homes in a condomium complex cannot get a reverse mortgage now ? We are praying for the bill not just the extended limits because it will help us save our homes. Without this many seniors will have to sell the house. We cannot even get a line of credit. Most of us did not know we would not qualify when we bought. Other condimiums units with shared walls can get a reverse mortgage. I am sure there are many seniors in this situation. Are any of you out there?
Jamie
Hi Marie,
I am a Reverse Mortgage Loan Officer and I have a list of people that I update regularly regarding this legislation because they have manufactured homes in Co-ops and can't get a reverse mortgage today. They are all holding their breath and crossing their fingers that something happens soon. Hang in there, you are not alone.
Marie
Thanks Jamie for the encouragement. I know many of us are just holding on by our fingernails. Several homeowners in my complex are in danger of having to sell. We can't wait much longer.
bennettjohn
in the last 12 hours i have added two comments. after keying them, i entered the code and clicked on "submit". immediately my screen went blank... no notification of red or green type indicating acceptance.
anyone know how i can recover them?
they took hours to type, and said "Let's all fax Chris Dodd at 202.224.1083 and tell him to vote for increased FHA limits for HECM mortgages.
thanks,
ben
Jamie
I have had lot's of calls asking if there are any updates. Has anyone heard anything?
Jamie
I just called Senator Dodd's office and was told that the FHFRR Act of 2008 should hopefully go to the floor tomorrow for a vote.
RickM
Dick Armeys article in the Wall Street Journal says this is a bailout and says FHA is bleeding. Brian Montgomery says FHA is solvent. These opposing opinions are pulling at this but since there's so much talk in past 6 days, I think its coming to a head. Hopefully the $550,000 is approved, the cap on HECM is $6000 and they remove the numbers cap.
John
Go to: banking.senate.gov to get the right information. The Dodd/Shelby statement and the links on the Senate bill to be debated on possibly today.
karen
Thank you John for that link. I wrote an email to the Committee. Now I am confused by RickM's statement regarding the $6000 cap on a HECM........what is that all about?
Jamie
Karen,
I believe the legislation will cap the origination fee at $6,000. Currently is origination fees can run as high as $7255.80 depending on your county lending limit. If the limits increase, then so would the origination fees. With this $6000 cap, you would have the benefit of the increased limits without an increase in origination.
BILL
JOHN
If the President vetos the bill
do you think there is a 23 majority to over turn ??? !!!
Jamie
5/20 - Looks like they will adjourn for the day with no outcome. I see HR3221 on the Senate calendar for 5/23 and 5/24 so we will have to wait and see what happens.
John
Bill, Yes there is a bipartisan majority in favor of passing HR3221 (includes FHA Modernization). The President has some objections to parts of the workouts that Senators Dodd/Shelby came up with. This weekend their staffs will be working on changing the objectionable items if possible. Remember that the House has to approve of the changes that they may of initially proposed. The House also has a bipartisan majority that can override any presidential veto. Personally I doubt the President will veto the bill.
BILL
John:
As always , Thank You So Much for
your insite ...(I feel better already )
Jamie
John - Do you think they will be able to make the changes and get the appoval from the House before 4th of July? It just seems like a lot to get done and they have been moving like snails. Thanks for sharing, we really appreciate it.
Jo Ann
06/22/08---I know the HUD MIP of 2% is set, but,is the 2% Origination Fee (lender) set in stone or is it negotiable? My GFE is very generalized - must I wait until day(s)before closing for actual figures or can it be provided now with closer-to-actual numbers?
TIA for any info
karen
Thanks for sorting out the $6000 for me Jamie. I feel like I have been perched at the top of a roller coaster for months just waiting for the FHA Modernization Bill to pass.
bennettjohn
many of us on this site feel the same way, karen. i didn't know the origination fee was negotiable until jamie mentioned it. is it legit to contact one another off this site if i want a competitive quote? at dodd.senate.gov the senator mentions bush is strongly in favor of the FHA Modernization Bill. it's the other "stuff" that's been added that has caused him to threaten a veto. it will pass.
John
6/24/08 C-SPAN has live coverage of the HR3221 Bill. Senator Dodd is asking that fellow senators not add new amendments to this massive bill because it would delay it getting to the President by the July 4th estimate. Voting today or by closing tomorrow.
BILL
6-25-08
John: Please give us you insite ..
The Reverse Mortgage Daily Post stated -- that the bill might have a loan limit of $625,000 although this amount is NOT for HECM & the amount for HECM could stay at the
$417,000 .. is this info. correct !!!???
John
Bill, "It's not over till it's over" Senate version of HR3221 says $625,000. House would like the temporary limit of $729,750 extended. This Senate bill is over 500-600 pages long and is not specific on a Hecm national loan limit at all.
BILL
6-25-08
Thank You JOHN
karen
John & Jamie,
If HR 3221 does not pass, is there a chance the FHA Modernization S.2338 or another version of this bill has a chance of passing.......today did not look at all promising! Thanks for the info in advance,I am so frustrated sometimes it is frightening just to check to see what is happening.
John
Senator Ensign(Nevada) is obstructing passage of the bill because he can not add his energy tax credit amendment to HR3221. Senate Majority leader Harry Reid (Nevada)regrets that because of the extra hurdles one senator is creating, the bill can not move forward until after the 4th of July recess. Curious that both represent Nevada. Special interest or the people?
karen
I think both reasons apply, John. How long is their July 4th recess and don't they have another three-week recess in August? Does anyone think there a chance this could get done before Labor Day? or is this just a dead issue at this point?
John
Karen, It will get done with or without Senator Ensigns objection, just more congressional procedural hurdles. This same senator voted against the House energy bill earlier this month and now wants us to believe anything he says about energy.
karen
Thanks, John. You have given me some hope again.
Jamie
John,
Does this mean now we are done until after the 4th of July recess? I try to keep up with the blogs and cspan, but it gets a little overwhelming. Thanks!
bennettjohn
friends- thurs. 6/26 11 p.m. edt
the senate just adjourned for a ten day recess without taking a final vote on the HR3221 bill. once again, as john said, 2 senators have thrown procedural hurdles in its path. chris dodd did say that upon their return in 10 days that there will be a cloture vote to shut down the dissenters and then proceed with a final vote. of the several votes taken so far from the initial reading of the bill, to the several amendments to the bill, the lowest "aye" vote total was 77. there is an overwhelming majority in favor of the bill, it should come to final vote within 48 hours of their return. then back to the house for their final vote, then to W's desk.
there is light at the end of the tunnel.
karen
So are we back to "square one" again? Is there anything that was changed in the bill (by the Senate) that would cause the House to reject it or add another amendment? If Bush vetos the bill, how long would it take to override the veto so we can move forward? I can't hold on much longer - it seems we have been down this road before.
John
Karen, The House and Senate leadership have been busy behind the scene to compromise on their differences. Senator Ensign's energy bill has nothing to do with the housing or foreclosure prevention issue and will hurt getting HR3221 thru the House. Bush is not going to veto the bill and even if he does, there is a bipartisan majority that can override any veto.
Jim
Are there any late indications where the HECM LENDING LIMIT will end up.
reggie
will the housing rescue bill support people who file bankrupcty
Marie
The bill is on the senate calendar for the afternoon session on July 7th. Maybe it will get thru sometime this century.
Jamie
Karen & Robert - I also meant to add to an earlier post regarding the orgination fee being negotiable. While you are shopping, don't forget to ask about the monthly servicing fee. They can vary between $25 and $35 a month. The difference is the lender or broker will make more when the loan is sold if they charge you more than $25. They don't usually offer the $25 unless you ask. It may not seem like a big difference now but over time with the compounding interest, it can add up.
John
Jamie, As you know there are many ways a lender can make up for a lower origination fee, such as a higher margin, different index(Libor) or higher monthly servicing fee. Counseling now instead of waiting for Congress to pass FHA Modernization can help answer many questions. Certifications are good for six months. I'm hoping bill passes before then.
Jo Ann
Need clarification. As I wrote before, I am in the process of obtaining a RM and am waiting for the legislation to raise the HECM loan limit higher than $200,160 for Virginia. My home appraised for $250k, but I must close by 07/11/2008 or obtain a new appraisal.
My dilemma is whether I should chance a much lower appraisal after six months? in order to obtain more funds. OR, close and accept the present RM loan...
Jamie - you say the origination fee is negotiable. On my loan-$200,160 is used to calculate the principal limit and the lender's origination fee is therefore $4003.
All closing costs=$10953 and I have been trying to get the lender to reduce as many of the fees as possible.
Their monthly service fee is $30. Question is: since I am already in the process, can I now ask that the $4003 fee be reduced?
ANY help most appreciated! I have been living the RM saga for over six months now. I only want to do this once and need all the advice I can get.
Jamie
John - You make a good point and that is why it is important to really look at the numbers and shop around if you aren't sure that what you are being quoted is best for your situation. I don't think that you should pick your someone because they are "the cheapest" but I do think it is smart to get more than one quote. Counseling is always a great way to go and there are still some agencies out there that will offer it without a fee. Thanks again for sharing.
Jamie
Jo Ann - You can always ask the lender to negotiate the origination but there are some out there that have a firm policy not to discount. You really won't know unless you ask. As for holding off on closing to wait for the legislation and new lending limits, you need to see how much your value has changed since the first appraisal and will it make a significant difference in the amount you will receive if you were to wait. Remember you will only receive a percentage of the difference in value, not the entire amount. You might also want to ask the appraiser what he would charge to "update" the appraisal since 180 days have passed. Many appraiser will not charge the full amount for another appraisal since most of the data is there and they are updating comps. Again, ask first since I am not an appraiser and I don't want to give you bad info.
Jo nn
Thanks so much, Jamie, for the info.
Yes, I believe the appraisal can be updated for a lesser cost. I am more concerned as to how much my home may have dropped in 6 months. If I knew that, it would be easier to make a decision whether to wait or not.
The stall in the legislation comes at a critical time for me - and others, too, I am sure.
Thanks again!