House Passes Bill to Suspend Cap on Reverses

The House has passed a bill to prevent a shutdown of the Federal Housing Administration reverse mortgage program while the federal government is operating under a continuing fund resolution.The bill (H.R. 391), sponsored by Rep. Tim Matheson, R-Utah, temporarily suspends a 275,000-loan cap on the number of home equity conversion mortgages the FHA can insure until the current continuing resolution expires on Feb. 15. The FHA's HECM program is very close to the 275,000-loan cap, and the lawmakers don't want the problems in the budget process to spill over and prevent seniors from tapping the equity in their homes. The Matheson bill, co-sponsored by Rep. Barney Frank, D-Mass., has to be approved by the Senate and signed by the president to become effective. Nevertheless, H.R. 391 supporters want to attach the same language to the next continuing resolution so that the HECM cap is suspended until Sept. 30.