The original guidelines, codified in the ML 2024-24 of December, is designed to broaden the ways for borrowers to meet lenders after the success of external communication about housing issues during the COVID-19 Pandemie.
But after revising the policy that was planned to come into force on July 1, the new US Department of Housing and Urban Development (HUD) Leadership under the Trump government has established that the provisions in the earlier guidance were too heavy and make some changes.
“HUD has since established that the permanent requirements established in ML 2024-24 are unnecessarily burdensome,” the letter from Tuesday reads partially. “This ML contributes to the permanent policy that has been established in ML 2024-24, with effect from 1 July 2025.
“This ML also expands what can be used to meet the reasonable effort requirements, including allowing [lenders] To demonstrate compliance with [regulations]. “
The new ML also makes technical corrections for guidance published in January, shortly before the inauguration of Trump, which expanded the recovery options from COVID-19 to February 2026. The FHA was the moment the stakeholders “have time to implement the new loss restriction, claims and reporting requirements.”
This week’s letter said that the loss mitigation practices from the COVID era will end in September 2025, but things that will already be allowed in the pipeline and approved after that point will be allowed to continue.
Conditions are also updated in the new letter. What was previously known as a “loss restriction” is now simply known as an “interview”, and the definition and suffering of a “reasonable effort” to contact a affected borrower has also been changed.
The commitment of the early borrower in the process remains encouraged, but the new guidelines have been designed to give lenders a procedural flexibility in the process of achieving the legal outcome.
Rules for the eligible for reimbursement plan have also been tightened up in the new letter, and a certificate from a borrower for the affordability of such plans will now be necessary.
