FHA issued Mortgagee Letter 2026-08, clarifying its loss mitigation requirements governing Trial Payment Plans (TPPs) and borrower evaluation for loss mitigation assistance. Per the Mortgagee Letter (ML), FHA specifically:
- Established a new reason for a TPP failure when a borrower repeatedly fails to accept a TPP agreement for the 3rd time;
- Permitted payments under a permanent home retention option to increase after a TPP due to increases in taxes or insurance; and
- Limited borrower requests for re-review for loss mitigation prior to foreclosure initiation to instances where a change in the borrower’s circumstances impacts their eligibility for a loss mitigation option.
This ML also revises the TPP requirements to allow borrowers to make their TPP payments in advance of the month in which they are due, ensuring that proactive borrowers are not penalized, which aligns with the housing policy waiver issued on March 3, 2026. The provisions of this ML must be implemented no later than September 21, 2026 (servicers may, however, implement the provisions immediately).
Click to view the FHA Mortgagee Letter 2026-08: https://www.tenaco.com/wp-content/uploads/2026/06/FHA-Mortgagee-Letter-2026-08-06-23-26.pdf
Click to view the FHA Info #2026-13: https://www.tenaco.com/wp-content/uploads/2026/06/FHA-Info-2026-13-FHA-ML-2026-08-06-23-26.pdf
