One year suspension of Reverse Mortgage Caps

Posted by charles dennis

July 18, 2007

Senate appropriators have approved a Department of Housing and Urban Development spending bill that includes $100 million for foreclosure prevention counseling.

Sen. Charles E. Schumer, D-N.Y., said the $100 million will go to nonprofit counseling agencies that work with borrowers who are trapped in unaffordable subprime loans. “The current situation in the subprime mortgage market is untenable,” Sen. Schumer said. “The more we do to help solve it, the fewer families will be faced with losing their homes because of bad loans and dubious mortgage brokers.”

Sen. Schumer and two fellow Democrats — Sens. Robert P. Casey Jr. (Pa.) and Sherrod Brown (Ohio) — have co-sponsored a bill that would provide $300 million for foreclosure prevention counseling and clamp down on certain kinds of subprime lending.

The HUD appropriations bill also increases the loan limit on FHA-insured multifamily mortgages and suspends for one year a cap on the number of reverse mortgages the FHA can insure.