FHA streamlines distressed mortgage borrower rules

The Federal Housing Administration has revised updates planned for rules around contacting and offering options to distressed borrowers.

The FHA has removed required outreach at particular times from a planned transition to permanent loss mitigation options from temporary pandemic contingencies, and also is tweaking modernization of what were originally “face-to-face” meeting requirements.

Overall, the new version of the loss mit and borrower contact requirements will be more cost effective for servicers, according to the Department of Housing and Urban Development affiliate, which insures certain affordability loans often utilized by first-time homebuyers.

“These targeted policy updates expand the options available for mortgagees to reasonably engage with borrowers in default and are…