The U.S. Department of Housing and Urban Development this week completed modifications to the Home Equity Reverse Mortgage Information Technology (HERMIT) to accommodate new premium structures and initial disbursement limits implemented last September.
While HUD had already modified FHA Connection and released Version 2.0 of the HECM Calculation Software to accommodate these changes, changes to the HERMIT system were delayed until now.
Mortgagees must follow the Mandatory Obligations Mapping Instructions in the HERMIT System Change – Release 3.7 document to initiate the collection of the Initial MIP.
HUD acknowledged that FHA Connection was unable to accommodate cases where the amount of the borrower’s mandatory obligations was greater than the initial principal limit amount. To address this technical issue, two new data fields have been added to FHA Connection. It has become necessary for FHA to change how mortgagees enter the amount of mandatory obligations in FHA Connection and the HECM Calculation Software (special instructions).
Effective for all HECM case numbers assigned on and after March 10, 2014, mortgagees must use these instructions. For more information, visit FHA’s web page for HECM Lenders.