Comments due on FHA proposal to revise its single-family loan servicing loss mitigation policy
The FHA yesterday released proposed revisions to its single family servicing policies that are designed to remove unnecessary barriers for homeowners seeking mortgage payment relief, achieve operational consistency with industry standard best practices, and reduce burdens incurred by the industry when servicing an FHA-insured mortgage portfolio. FHA posted the proposal today on its Single Family Housing "Drafting Table" webpage. The revisions focus on:
- Revising the standard servicing loss mitigation home retention waterfall to ensure borrowers are evaluated for the solution that is most likely to best help them avoid foreclosure;
- Eliminating unnecessary and time-consuming borrower documentation requirements for Trial Payment Plans, bringing FHA requirements into alignment with industry best practices and allowing servicers to grant assistance more quickly; and
- Modifying other servicing and operational policies, including the allowable fee structures, that provide more consistency between FHA policies and those used by the private market and the Government Sponsored Enterprises.
Comments on the proposal should be submitted via the process prescribed on the "Drafting Table" webpage, and will be accepted through September 12, 2020.