(HUD) changes Policy

On June 12, the U.S. Department of Housing and Urban Development (HUD) changed its policy regarding non-borrowing spouses of reverse mortgage borrowers. Mortgagee Letter 2015-15 gives reverse mortgage lenders the option to assign a loan to HUD if a surviving spouse lives in the home without requiring the spouse to pass the “Principal Limit Test.” This test was a huge hurdle for non-borrowing spouses to clear under previous HUD policy. The new policy allows spouses with a more workable option to prevent eviction and loss of housing from foreclosure.

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