The Federal Housing Administration published a draft mortgagee letter on the Single-Family Drafting Table that would improve FHA’s ability to make prompt payments in the event of mortgagee default, ensuring that HECM borrowers receive scheduled or requested funds in a timely fashion.
With this draft ML, FHA proposes to expand the instances when FHA can investigate anticipated or actual mortgagee default on the obligation to make borrower disbursements. This ML also proposes that mortgagees be required to provide FHA with borrower payment information when FHA determines a mortgagee default on its payment obligations is likely in order to minimize delays in borrower receipt of eligible payments under their HECM loan.
Interested stakeholders are encouraged to thoroughly review the draft ML and provide feedback through June 12, 2023. Instructions for viewing and providing feedback are available on the Drafting Table. FHA will carefully consider all feedback received.