WASHINGTON, D.C. — The Federal Housing Administration (FHA) has announced extensions of a set of policy flexibilities for single-family lenders and servicers designed to maintain new mortgage originations for homebuyers and allow 203(k) rehabilitation projects to continue during the COVID-19 pandemic.
The agency states these temporary policies recognize the sustained need for flexibility during this critical time to ensure mortgage financing remains available for the nation’s low- and moderate-income homebuyers, and that home rehabilitation work can continue. The temporary policies will be in place through June 30, 2021.
“The temporary policies we’re extending today allow lenders to continue originating and closing mortgages designated for FHA insurance endorsement during the pandemic and ensure critical home repairs in progress can be completed,” said HUD Office of Housing and Federal Housing Administration Principal Deputy Assistant Secretary Lopa Kolluri.
Through Mortgagee Letter 2021-06 and Mortgagee Letter 2021-07 published today, FHA is extending the following temporary policies for Single Family Title II forward and Home Equity Conversion Mortgages:
- Use of an exterior-only appraisal scope of work; and
- Re-verification of employment, verification of self-employment income, and verification of rental income.
For Single Family Title II forward 203(k) rehabilitation mortgages only, FHA is also extending temporary policies for the administration of 203(k) Rehabilitation Mortgage Insurance Program escrow accounts for borrowers in forbearance.
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