Temporary Suspension on FHA Mortgagee Letter 2019-06

Temporary Suspension on FHA Mortgagee Letter 2019-06

by | Jul 23, 2019 | News

The July 23rd date for the Mortgagee Letter 2019-07, originally posted as ML 2019-06, has been delayed once again. A judge in the US District Court of Utah has granted an injunction to temporarily suspend HUD from implementing the new requirements for FHA loans since a decision has not been reached.

Back in April 18, 2019, HUD released Mortgagee Letter 2019-06 regarding Downpayment Assitance and Operating in a Governmental Capacity. The purpose is to provide clarification of required documents on FHA approved mortgages. This is to further ensure that governmental entities that are currently providing financing sources are complying with FHA requirements. The original effective date was for case numbers that were assigned on or after April 18, 2019.

Cedar Band of Paiutes filed a lawsuit against HUD. The suit states that the new requirements prohibits American Indian tribes from being able to participate in Downpayment Assitance Programs, threatening Cedar Band’s source of revenue. HUD had issued a 90-day stay to review the new requirements. On April 25, 2019, HUD released news that the Mortgagee Letter had been extended and the new effective date became July 23rd, 2019.

At the present time, HUD has not released any new updates regarding the current injunction in place and a new date has not been determined either.

We will continue to monitor the HUD website and all available resources to keep you up to date on any changes to the Mortgagee Letter. If you have your New Commitment Letters for FHA Loans available and would like to send them to us please do so and we will have in them in place in case any changes take place in the interim.