HUD’s face-to-face program provides the borrower with the opportunity to meet with a representative from the bank or mortgage company to discuss the delinquency of the loan, and attempt to set the borrower up on some type of repayment plan or loss mitigation option. This program will continue to be on a partial waiver until December 31, 2023.
HUD initially established this requirement stating, “The mortgagee must attempt a face-to-face interview with the borrower no later than the 61st day of delinquency, unless exempt under 24 CFR § 203.604.” On March 13, 2020, a National Emergency concerning Coronavirus Disease 2019 (Covid-19) was declared, which is also the date that HUD initially published a temporary partial waiver for the face-to-face requirement, and then through subsequent extensions, the partial waiver continued through December 31, 2022. On December 19, 2022, HUD extended the face-to-face partial waiver until December 31, 2023, due to several reasons including, but not limited to, continued public health concerns around the spread of Covid-19.
The partial waiver only applies to FHA-insured forward mortgages. The partial waiver does not apply to the Section 248 Insurance Program - the face-to-face requirements are still in place for this section (24 CFR § 203.604(e)(1)).
HUD has requirements that still need to be met in lieu of the face-to-face requirement; the mortgagee must still reach out to the borrower, contact the borrower, and attempt to meet the requirements of § 203.604. Per HUD, the mortgagee must complete the following:
If the mortgagee follows the aforementioned steps, the mortgagee will be meeting HUD’s expectations on their partial waiver for the face-to-face interview. The Servicing industry has another year to continue to enhance their communication and alternative methods to reach the borrowers, to discuss loss mitigation options without completing the face-to-face requirement.
HUD is stating many reasons for extending the partial waiver. Therefore, considering the existing Covid-19 National Emergency; the continuing PHE Declaration; general ongoing public health concerns for many resulting from the combination of Covid-19 pandemic, RSV, and seasonal flu; servicer constraints; costs; and safety concerns, HUD determines it is prudent to continue being cautious, and to take steps that safeguard the health and safety of the public, federal workers, contractors, and vendors.
This calls for several questions to be answered.
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