As previously reported, recently a US District Court granted a preliminary injunction preventing the US Department of Housing and Urban Development (HUD) from implementing new requirements for government-provided down payment assistance in connection with FHA insured loans. The requirements were announced in Mortgagee Letter 2019-06 and originally were scheduled to go into effect for case numbers assigned on or after April 18, 2019. HUD later extended the effective date to July 23, 2019 as a result of the legal challenge.
HUD recently announced in Mortgagee Letter 2019-10 the suspension of the effective date of Mortgagee Letter 2019-06 until further notice. HUD also advises that mortgagees may continue to follow the guidance in HUD Handbook 4000.1 II.A.4.d.ii, which sets forth existing requirements regarding government-provided down payment assistance.
