The Federal Housing Administration (FHA) updated its Single-Family Housing Policy Handbook to clarify instructions, add guidance, and incorporate previously published mortgage letters. Updates were made to eligibility requirements for borrowers and to administrative policies and procedures such as the registration and management of branch offices.

“Handbook 4000.1 is the comprehensive, authoritative source for Single Family Housing policy guidance for industry stakeholders doing business with FHA,” the FHA stated in its announcement. “It provides clear and concise policy and procedure requirements for all FHA single family housing programs. FHA’s Office of Single-Family Housing produces regular updates to ensure that Handbook 4000.1 remains the complete, single-source document for its latest policies, programs, and processes.”

Of the several updates, the FHA suggested two that mortgagees should be especially aware of:

• FHA increased the processing fee that mortgagees can charge borrowers assuming an existing FHA-insured mortgage, from a maximum of $900 to a maximum of $1,800. “This fee increase is designed to compensate mortgagees for costs of processing assumptions at a rate that is appropriate for today’s market,” the agency stated. “FHA last changed the reasonable and customary fee mortgagees could charge borrowers assuming an FHA-insured mortgage was in 2016.”
• Servicers are now required to transfer the borrowers’ language preference to a new servicer as part of a transfer of servicing rights in support of FHA’s efforts to provide information and services to borrowers for whom English may not be their first language.