The U.S. Department of Housing and Urban Development (HUD) recently issued Mortgagee Letter 2019-14 to announce updates to loss mitigation options for borrowers with Federal Housing Administration (FHA) insured loans if the borrower’s home or place of employment is located in a Presidentially-Declared Major Disaster Area. The policy updates apply to all FHA Title II forward mortgages.

Mortgagees may begin using the new procedures in the policy updates immediately but must implement the procedures no later than November 30, 2019. The policy updates will be incorporated into HUD Handbook 4000.1. HUD invites feedback on the policy updates for a period of 30 days from the Mortgagee Letter date, which is August 29, 2019.