May 9, 2023 — Letter

On behalf of NCLC’s low-income clients, NCLC responds to HUD’s planned revision of the face-to-face meeting regulation, 24 C.F.R. § 203.604, as indicated on the agency’s regulatory agenda.

By ensuring that servicers make a significant attempt to discuss loss mitigation options with borrowers, 24 C.F.R. § 203.604 facilitates the effective communication between borrowers and servicers that is necessary due to the complex and nuanced nature of FHA’s loss mitigation system. Recent changes to FHA’s waterfall, which allows borrowers to decide on options based on a phone conversation and not based on documents submitted for later review, further highlight the need to facilitate effective communication. Given the increased importance of conversations in this streamlined process, the face-to-face meeting rule is as critical as ever.