FHA Streamlines Claims Submission Process

The Federal Housing Administration this week published Mortgagee Letter 2018-08 to streamline the process for submitting HECM assignment requests to the Department of Housing and Urban Development.

For purposes of filing assignment claims, an alternate form of evidence of hazard insurance is now acceptable, alternate forms of providing the evidence of death of a co-borrower are now acceptable, the definition of “current” property taxes has been clarified, and the ability to use a Fannie Mae form 1004D for evidence of completion of repairs is extended to repairs performed prior to December 31, 2018.

In a prepared statement, FHA Commissioner Brian Montgomery said, “Streamlining the HECM claim payment process makes us more responsive to participating lenders and helps continue our effort to put the program on a more financially viable path.”

The guidance in this Mortgagee Letter modifies or supersedes policy language in ML 2017-05, where applicable, and is effective immediately.