The Federal Housing Administration (FHA) announced changes on Friday to its loss mitigation program which are intended to allow more borrowers to take advantage of opportunities that enable them to keep their homes. Through revisions made to FHA’s Loss Mitigation Home Retention Options, a greater number of distressed borrowers will be able to qualify for FHA loss mitigation interventions, and the level of assistance available to them will be larger than under previous guidelines. These changes will not only assist families in keeping their homes, but will also reduce the number of full claims against the FHA Mutual Mortgage Insurance Fund.
“FHA’s Loss Mitigation Program has long been an industry leader in helping to ensure that distressed borrowers are afforded maximum opportunities to retain their homes,” said Acting FHA Commissioner Carol Galante. “Not only are we taking steps to make sure more borrowers can benefit from FHA loss mitigation assistance, but we are also targeting our assistance to provide more sustainable payments for borrowers so that they are successful in retaining their homes over the long term. At the same time, these efforts will reduce losses to FHA from foreclosures, benefiting our insurance fund.”