FHA Issues Two Temporary QC Policy Waivers

The Federal Housing Administration (FHA) announced temporary updates to the current policies in place in regards to Early Payment Defaults.


  • Waiver of Quality Control Requirement for Early Payment Defaults on a temporary basis

  • Partial Waiver of QC Requirements for Field Review Appraisals

  • COVID-19 Impact on Mortgagee Compare Ratios

Temporary Waiver of QC Requirements for Early Payment Defaults

FHA temporarily suspended the requirement that mortgagees select and review all Early Payment Defaults (EPDs) on a monthly basis. With this waiver, mortgagees are not required to conduct quality control (QC) reviews of EPD loans that would have been selected as part of a mortgagee's May, June or July 2020 QC selections.


Partial Waiver of QC Requirements for Field Review Appraisals

Mortgagees are permitted to use third-party tools as an alternative to filed reviews of appraisals. This temporary partial waiver applies to QC reviews currently in process and for cases selected as part of a mortgagee's May, June or July 2020 QC selections.


COVID-19 Impact on Mortgagee Compare Ratios

FHA will consider the impact of the COVID-19 National Emergency as a relevant mitigating factor when a mortgagee's Compare Ratio is above the designed threshold. FHA encourages mortgagees to continue monitoring Compare Ratios closely, and to apply QC flexibility only to the extent necessary.


To review the complete temporary waiver of the QC requirements for Early Payment Defaults see the link: FHA INFO #20-44: Multisubject: COVID-19 Related Updates : FHA Issues Two Temporary QC Policy Waivers and Update on Impact to Mortgagee Compare Ratios

You may also visit the FHA Resource Center for frequently asked questions 24/7 at:

www.hud.gov/answers

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