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HUD Mortgagee Letter
Answer by Patricia Cashman, BOL Guru
Guru Bio

Question:  The HUD Mortgagee Letter 2006-08 states that notice of servicemembers rights must "Be sent to all homeowners who are in default on a residential mortgage." Does this mean notices are to be sent to servicemembers only who are in default or does it require the bank to send notices to all homeowners in default regardless if they are servicemembers or not?

Answer:  If you meant 2006-28, instead of 2006-08, the HUD Mortgagee Letter 2006-28 addresses only those covered loans to "servicemembers" and their spouses jointly. It calls for a different version of the "Homeownership Counseling" notice that has been in effect for several years. Section 106(c)(5) of the Housing and Urban Development Act of 1968 (12 USC 1701x(c)(5))provides for homeownership counseling notification by creditors to eligible homeowners. In November 2001, the "sunset" provision was repealed. This was addressed previously on BOL.

First published on 3/12/07

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