For mortgages with a Case Number assigned before August 4, 2014, where there is a Surviving Non-Borrowing Spouse, the Mortgagee must enter the borrower’s “Date of Death” in the Home Equity Reverse Mortgage Information Technology (HERMIT) system so that payments will be suspended automatically. The Mortgagee should then follow the requirements and conditions of Mortgagee Letter (ML) 15-15.
Where the Mortgagee elects the Mortgagee Optional Election (MOE) Assignment, the Mortgagee must not complete the Due and Payable Timeline.
Where the Mortgagee does not elect the MOE Assignment or after electing the MOE Assignment determines the Home Equity Conversion Mortgage (HECM) loan is ineligible for assignment, the Mortgagee must complete the appropriate Due and Payable Timeline within 60 days of such election or determination in order to provide HUD the required notification and to change the loan status in HERMIT to “Due and Payable.”
For mortgages with a Case Number issued on or after August 4, 2014, in the event of a Deferral Period, the Mortgagee must enter the borrower’s “Date of Death” in HERMIT so that payments will be suspended automatically. However, the Mortgagee must not complete the Due and Payable Timeline until the Deferral Period ends. At the end of the Deferral Period, the Mortgagee must complete the appropriate Due and Payable Timeline within 60 days in order to provide HUD the required notification and to change the loan status in HERMIT to “Due and Payable.”
A Mortgagee Optional Election (MOE) Assignment claim will be calculated and paid in the same manner as a standard assignment claim.
For more information see Mortgagee Letter 15-15 available at https://www.hud.gov/program_offices/administration/hudclips/letters/mortgagee
Any questions may be directed to the FHA Resource Center at Toll-Free (800) CALLFHA (225-5342) or by email to answers@hud.gov. Persons with hearing or speech impairments may reach this number by calling the Federal Information Relay Service at (800) 877-8339.