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The U.S. Department of Housing and Urban Development (HUD) recently issued a final rule reinstating the 2013 version of its disparate impact rule under the Fair Housing Act (Act) to replace a version of the rule adopted by HUD during the Trump Administration in 2020 that never became effective.  The final rule is effective 30 days after publication in the Federal Register. … Continue Reading

The U.S. Department of Housing and Urban Development (HUD) recently issued a final rule extending the maximum term of an FHA loan modification from 30 to 40 years. The rule is effective May 8, 2023.  HUD also issued Mortgagee Letter 2023-06 incorporating a 40-year standalone loan modification into FHA’s COVID-19 loss mitigation policies for situations in which partial claim funds are not available. … Continue Reading

The U.S. Department of Housing and Urban Development (HUD) recently issued a final rule replacing the London Interbank Offered Rate (LIBOR) with the Secured Overnight Financing Rate (SOFR) for newly originated FHA-insured adjustable-rate forward mortgage loans and Home Equity Conversion Mortgages (HECMs), and for existing adjustable-rate forward mortgage loans and HECMs. … Continue Reading

HUD recently announced a reduction to the annual mortgage insurance premium charged to borrowers with FHA-insured loans. HUD estimates that the reduction will save FHA borrowers on average $800 annually. HUD also released Mortgagee Letter 2023-05 addressing the premium reduction, and a Factsheet addressing other steps that HUD has taken to make homeownership more affordable. … Continue Reading

In Mortgagee Letter 2023-01, the U.S. Department of Housing and Urban Development (HUD) addressed the use of the revised Fannie Mae and Freddie Mac single-family loan documents with FHA Title II forward mortgage loans.   As previously reported, in July 2021 Fannie Mae and Freddie Mac released revised versions of their notes and security instruments for single-family loans. … Continue Reading

The U.S. Department of Housing and Urban Development (HUD) recently issued a draft Mortgagee Letter on reconsideration of value (ROV) policies in connection with appraisals for FHA insured mortgage loans.  The draft Mortgagee Letter follows up on action plan items set forth in the Property Appraisal and Valuation Equity action plan jointly issued by HUD and other federal agencies in March 2022. … Continue Reading

In Mortgagee Letter 2022-22 dated December 15, 2022, the FHA announced updates to its Single Family Housing Policy Handbook (HUD Handbook 4000.1) that modifies its policies governing conflicts of interest and dual employment.  The modifications both narrow the employees who are subject to the conflicts of interest policies, and subjects those employees to what appear to be more significant restrictions. … Continue Reading

The U.S. Department of Housing and Urban Development (HUD) recently announced the 2023 loan limits for FHA insured forward mortgage loans and FHA insured Home Equity Conversion Mortgages (HECMs).  The announcements were made in Mortgagee Letter 2022-20 and Mortgagee Letter 2022-21, respectively.

For forward mortgage loans in non-high cost areas, the amount for a single unit home increased from $420,680 in 2022 to $472,030 in 2023. … Continue Reading

The U.S. Department of Housing Urban Development (HUD) recently issued a final rule permitting the use of private flood insurance policies with FHA-insured mortgage loans.  HUD also issued Mortgagee Letter 2022-18 addressing with regard to FHA-insured loans general flood insurance requirements, flood insurance requirements for condominiums, manufactured homes and home equity conversion mortgage (HECM) loans (i.e.,… Continue Reading

The National Community Reinvestment Coalition (NCRC) recently filed two complaints against appraisers with the Department of Housing and Urban Development asserting different treatment based on race in violation of the Fair Housing Act. One complaint asserts different service levels based on race, and the other asserts different home valuations based on race, with White individuals receiving better service or home valuations than Black individuals.… Continue Reading