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HUD No. 23-097
HUD Public Affairs
(202) 708-0685
May 17, 2023

Federal Housing Administration Finalizes Policies to Expedite Claims Processing for Home Equity Conversion Mortgages

New policies are expected to shorten the timeframe for mortgagees to receive Home Equity Conversion Mortgage assignment funds.

WASHINGTON - Today, the Federal Housing Administration (FHA) is announcing new policies that will allow for faster payment of funds to mortgagees when they assign a Home Equity Conversion Mortgage (HECM), also known as a reverse mortgage, to HUD. The changes permit people with FHA mortgages to submit a request for Preliminary Title Approval earlier in the process and with fewer documents. Combined, these changes will reduce the time between a loan’s eligibility for assignment to HUD and the payment of claim funds to the mortgagee.

“The Home Equity Conversion Mortgage program is an important resource for the nation’s senior homeowners who wish to age in place,” said Assistant Secretary for Housing and Federal Housing Commissioner Julia Gordon. “Today’s changes simplify processes and pay mortgagee claims more quickly, providing meaningful relief to program participants as they navigate the unique challenges of today’s economic environment.”

The HECM program allows a mortgagee to assign a HECM to HUD when the HECM reaches 98 percent of the Maximum Claim Amount (MCA). Under the new policy, mortgagees may begin submitting required information and documentation to HUD when the HECM reaches 97 percent of the MCA, based on the value of the property at the time the HECM loan is originated.

Under previous policy, mortgagees could only submit the required information and documentation when the HECM reached 97.5 percent of the MCA. In addition, FHA will now allow mortgagees to submit original notes and mortgages after assignment claim payment rather than before, as previous policy required. By allowing earlier claim submission and by making document submission more flexible, FHA expects to shorten the time between the HECM reaching 98 percent of MCA and FHA paying the mortgagee for the claim.


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