HUD issued Mortgagee Letter 2016-10. Under the Mortgagee Letter, the compounding interest rate (commonly referred to as the growth rate) used when calculating the servicing fee set-aside with respect to a HECM is revised to use the note rate (rather than the expected average mortgage rate and the annual MIP rate). The Mortgagee Letter also permits servicers of HECM loans to pass costs of obtaining third party verification of an applicant’s property tax payment history to the borrower. In addition, the Mortgagee Letter provides a revised HECM Financial Assessment and Property Charge Guide.
State Compliance Summary
Tennessee Increases Permissible Interest Rate for Closed-end Loans under Industrial Loan and Thrift Companies Act
Tennessee passed a bill increasing the permissible interest rate for closed-end loans under the Industrial Loan and Thrift Companies Act (ILTCA). Under the bill, the
April 1, 2025
