FHA published the quarterly update to its Single Family Housing Policy Handbook (SF Handbook 4000.1). This publication updated and clarified FHA’s servicing and claims policies, and includes additional updates to other sections of the SF Handbook.
Per the SF Handbook transmittal, the servicing and claims updates include:
- Revised guidance for FHA-Home Affordable Mortgage Program (FHA-HAMP) Trial Payment plan (TPP) terms; including the requirement for TPP Agreement documents to stipulate the causes of TPP failure; and to clarify when the Mortgagee is required to waive late charges for instances when a Borrower is on, or is paying, its agreed upon Loss Mitigation Option;
- Clarification of the Property and Preservation timeframe requirements for securing and maintaining vacant properties;
- Clarification that Supplemental Claims for reconveyance must be submitted within six months of the final settlement date of the reacquisition claim; and
- Restructured FHA’s Loss Mitigation Options for Borrowers in a Presidentially-Declared Major Disaster Area (PDMDA) per Mortgagee Letter 2019-14.
The update also includes:
- Incorporation of the Maximum Loan-To-Value and Combined Loan-To-Value Percentages for Cash-Out Refinance Mortgages per Mortgagee Letter 2019-11; and
- Updates to the Condominium sections under “Required Documents” to incorporate reference to the newly approved HUD forms.
All lenders should review and become familiar with the changes outlined in the SF Handbook Transmittal (as found on HUD’s Client Information Policy Systems’ [HUDCLIPS] Housing Handbooks web page). Unless otherwise noted in the transmittal, previously announced effective dates are not impacted by these SF Handbook changes. Changes identified in Section II of the Transmittal may be implemented with the original effective date of October 15, 2019, but must be implemented for case numbers assigned on or after January 2, 2020. Changes identified in Sections III and IV may be implemented immediately, but must be implemented no later than January 2, 2020.
