The White House this week released a Fiscal Year 2021 proposed budget that predicted strong economic numbers for the Home Equity Conversion Mortgage program during the next federal fiscal year that begins on October 1, 2020.
The budget projects the HECM program will operate at a credit subsidy level equal to negative 2.39, which means the program will generate substantially more receipts than it pays out in claims for that year’s book of business. Budget estimates show HECM endorsements totaling $13.6 billion for the current federal fiscal year that ends September 30 and $10.7 billion in FY2021.
Since the HECM program is self-sustaining and doesn’t require an annual appropriation from Congress, the President’s budgets provide a valuable bellwether on future HECM performance.
NRMLA will continue to evaluate these budgetary numbers and report back to the membership with any useful insights.