In connection with FHA-insured HECM loans, due to COVID-19, FHA recently announced a temporary partial waiver and a corresponding housing directive waiver of the deferral period requirement that an Eligible Non-Borrowing Spouse (Eligible NBS) must, within 90 days from the death of the last surviving borrower, establish legal ownership or other ongoing legal right to remain for life in the property securing the HECM. These waivers temporarily waive (until October 1, 2021) this deferral period requirement provided in Mortgagee Letter 2014-07 and 24 C.F.R. § 206.55(d)(1).
In the announcement, FHA noted that with the closing or limited operations of government offices and businesses due to COVID-19, it may be difficult for an Eligible NBS to obtain the necessary documents establishing legal ownership or legal right to remain in the home. FHA stated that a “partial waiver is necessary to allow Eligible Non-Borrowing Spouses to enter into a deferral period and avoid foreclosure when an Eligible Non-Borrowing Spouse is unable to meet this requirement due to the COVID-19 Emergency.”