NRMLA has asked the Department of Housing and Urban Development to consider extending its Optional Reimbursement Claim Alternative (ORCA) to the HECM program.
Earlier this year, HUD published a draft mortgagee letter to the Single-Family Drafting Table that proposed to establish ORCA for mortgagees who elect to submit early claims for reimbursement of taxes and insurance costs paid prior to a final claim payment.
Interested stakeholders were invited to submit comments on the proposed mortgagee letter by March 3, 2025.
What they’re saying: In its letter to HUD, NRMLA says it fully endorses FHA’s efforts to support mortgagee liquidity and the ORCA initiative. However, the liquidity concerns that FHA recognizes and has proposed to address are not limited to FHA-insured Single Family Title II forward mortgages,” says NRMLA.
- Mortgagees participating in the HECM program must make advances for a variety of property charges after a HECM has defaulted, the most significant of which are property taxes, property insurance and flood insurance.
- NRMLA strongly urges FHA to extend ORCA to include HECMs thereby “increasing HECM mortgagee liquidity and supporting the sustainability and soundness of the HECM program.”
