28 THE CHARBONNEAU VILLAGER
September 2019
Recent Law Changes Allow For More Opportunity for Oregon’s Seniors
More people are hearing the plight of Oregon’s seniors and it is evident in
the recent law changes. This month, we saw the signing of Oregon House Bill
2587 which affected the Oregon property tax deferral program and some big
changes to the federal FHA program were announced by HUD: Both chang-
es are opening doors for seniors who have been hoping for more options for
years.
One of the downfalls of the property tax deferral program has been that par-
ticipants were unable to keep their deferral sta-
tus if they desired to obtain a reverse mortgage
on their property. This pitfall will soon be histo-
ry for some, as governor Kate Brown has signed
HB 2587 which takes effect September 29, 2019.
The new law will allow some participants whose
residence is in the state’s tax deferral program
to adopt a reverse mortgage that has at least 40
percent equity interest in their home at the time
of filing their claim, in addition to other state
requirements.
This new legislation changes the old rule that
prohibits homeowners from having a reverse
mortgage and being on the tax deferral pro-
gram: In the past people would have to choose
between one or the other, whichever has the most benefit to them. With the
change in this policy, now some homeowners in the tax deferral program are
eligible to have a reverse mortgage available to them.
The law change DOES NOT allow for all who have reverse mortgages to be
eligible for property tax deferral or vice versa. Only some are eligible to apply
under certain circumstances. The Oregon dept of revenue states:
“The bill allows homeowners to have a reverse mortgage and be on the de-
ferral program if:
(a) they were on deferral before 2011 with a reverse mortgage from before
2011 (grandfathers existing law to continue such eligibility); or
(b) they have a reverse mortgage entered into on or after July 1, 2011 and
before January 1, 2017, and have equity of at least 40% at time of deferral ap-
plication. This does not enable retroactive deferral payments for prior tax years
but enables DOR to pay the taxes on deferral going forward for those homes.
If the home has a reverse mortgage entered into on or after January 1, 2017,
the home does not qualify for deferral. Applications for deferral will next be
accepted in early-2020 (usually early-January), and the Department of Reve-
nue will be requesting information from the applicants about debt balances
against the home to verify sufficient equity to qualify and have a 2011-2016
reverse mortgage.”
Jeff Foody, President of Northwest Reverse Mortgage thinks this is a wel-
come change: “Several times people have came to us for assistance and we were
unable to help them due to the deferred taxes. We aim to keep seniors in their
homes for longer, fuller, more enjoyable lives and this new bill follows suit
with those ideals. We hope to be able to help many seniors access their equity
to lift the financial burdens that have so many bogged down.” Said Jeff.
In addition to the changes at the state level, the federal government has been
busy making changes to the National Housing Act that will have a huge impact
on seniors and the Oregon condo market.
Historically, it hasn’t been easy to get a condo project FHA approved. FHA
has many rules and requirements that many associations are not able to meet.
HUD has been under increasing pressure to tweak the requirements to allow
more people to achieve the American dream of homeownership. On august
14th 2019, HUD announced new changes to the National Housing Act that
will allow spot approvals to individual condo units without approval of the
entire condo project.
There will still be certain eligibility require-
ments and stipulations the condo unit, associa-
tion and owner will have to meet for approval.
Only certain units will be approved that meet
the requirements and there will be a limit on
how many units can get FHA approved in each
building. The new changes will open the oppor-
tunity for FHA loans to many people; some of
which have been living in their units for many
years while dealing with rising costs due to de-
ferred maintenance and special assessments.
These rule changes allow for seniors who live in
non FHA approved buildings to seek out a re-
verse mortgage in order to live more comfortably
during retirement and be able to keep up with
the rising cost of living.
“In the past when a senior was interested in a reverse mortgage, we couldn’t
move forward unless the entire condo building was FHA approved. If it wasn’t
already approved, it was practically impossible to get the HOA to cooperate
with us to get the building approved. Now, seniors can apply with us for spot
FHA approval of their individual condo and if approved, they will be able
to apply for a reverse mortgage with us to get rid of their monthly mortgage
payments and access some of their equity to provide for a more comfortable
lifestyle.” Says Jeff Foody (MLO 253303) President of Northwest Reverse Mort-
gage.
Housing and Urban Development (HUD) Secretary Ben Carson said “Con-
dominiums have increasingly become a source of affordable, sustainable home-
ownership for many families and it’s critical that FHA be there to help them;
Today, we take an important step to open more doors to homeownership for
younger, first-time American buyers as well as seniors hoping to age-in-place.”
www.hud.gov/press/press_releases_media_advisories/HUD_No_19_121
The new FHA changes will go into effect October 15th 2019. Northwest Re-
verse Mortgage is ready and able to help you apply to get your unit approved.
Reach out to us today if you have any questions about any of the recent chang-
es and how it may affect you. With over 17 years doing nothing but reverse
mortgages, Northwest Reverse Mortgage is your local expert.
Call Us Today! 503-427-1667
Northwest Reverse Mortgage, LLC. NMLS-1834787. Equal Opportunity Mortgage Broker. Credit on approval. Terms subject to change without notice. Not a commitment to lend. Contents not provided by, or approved
by FHA, HUD or any other government agency. All potential tax benefits should be verified with a professional licensed tax advisor. www.nmlsconsumeraccess.org/EntityDetails.aspx/COMPANY/1834787 At the con-
clusion of a reverse mortgage, the borrower must repay the loan and may have to sell the home or repay the loan from other proceeds; charges will be assessed with the loan, including an origination fee, closing costs,
mortgage insurance premiums and servicing fees; the loan balance grows over time and interest is charged on the outstanding balance; the borrower remains responsible for property taxes, hazard insurance and home
maintenance, and failure to pay these amounts may result in the loss of the home; interest on a reverse mortgage is not tax deductible until the borrower makes partial or full re-payment.