The purpose of this page is to help FHA approved lenders by providing links to policy, guidance and tools that help in the origination and servicing of HECM loans.
Home Equity Conversion Mortgage (HECM) Program FHA Connections ADP Codes
As of September 30, 2013, the HECM Standard and HECM Saver ADP codes are no longer available. As a result of this, some lenders have reported a few circumstances for some case numbers ordered on or before the September 28, 2013 where the ADP code may need to be changed. Lenders who are experiencing issues regarding changes in the HECM FHA Connections ADP codes should contact the FHA Resource Center for Guidance no later than November 22.
Changes to HECM Program Requirements
Mortgagee Letters 13-27, 13-28 and 13-33
HUD issued two Mortgagee Letters (ML) implementing several changes to the Home Equity Conversion Mortgage program that will strengthen the FHA Mutual Mortgage Insurance Fund, thereby protecting the viability of the HECM program. ML 13-27, "Changes to the HECM Program Requirements, and ML 13-28, "HECM Financial Assessment and Property Charge Guide," collectively describe policy changes that will take effect with case numbers assigned on or after September 30, 2013, and with case numbers assigned on or after January 13, 2014. ML 13-33 clarifies and makes technical corrections to policy issued in ML 13-27.
HECM Calculation Software
As a result of the changes above, HUD has revised the HECM Calculation Software to compute HECM payments using new Principal Limit Factor Tables. The Calculation Software will also determine the first year Initial Draw Limit and compute the initial mortgage insurance premium based on the new requirements.
Additional modifications are underway to make changes to the Annual and Monthly Amortization Reports to separate mandatory obligations categorized as loan costs from cash advances to the borrower for determining the financed closing costs. These changes are also necessary to produce the Total Annual Loan Cost (TALC) Disclosure that is consistent with Regulation Z.
The software is available for download below under software.