HUD Mortgagee Letter 2025-12

hud-ml-2025-12

HUD Mortgagee Letter 2025-12. See obligation entries for operative requirements and verbatim primary-source citations.

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source:
  type: regulation
  id: hud-ml-2025-12
  authority: HUD Mortgagee Letter 2025-12
  description: |
    HUD Mortgagee Letter 2025-12. See obligation entries for operative
    requirements and verbatim primary-source citations.
obligations:
  - id: hud-ml-2025-12-loss-mit-eligibility-verification
    canonical_id: hud-ml-2025-12-loss-mit-eligibility-verification
    section: HUD ML 2025-12 — Eligibility to Participate in HUD Programs (III.A.2.h.iii(A))
    description: |
      Before offering any FHA Loss Mitigation Option, [LENDER] must verify
      that the Borrowers are eligible to participate in HUD's Loss Mitigation
      Program. To be eligible, the Borrower may not own other FHA-insured
      real estate (except under the stated exceptions); has not been the
      Borrower (except through inheritance or as co-signer only) on prior
      loans on which an FHA claim has been paid within the past three years;
      must not be debarred, suspended, or subject to a HUD LDP for the
      relevant home-retention options; and may not have unresolved delinquent
      Federal Debt for Partial Claim / Combination / Payment Supplement
      options.
    type: do
    audit_question: For every FHA-insured Mortgage in Default for which [LENDER] offered a Loss Mitigation Option, can [LENDER] evidence the Borrower-eligibility verification (no other FHA-insured real estate beyond stated exceptions; no FHA-claim-paid prior loan in past 3 years; no debarment/suspension/LDP for relevant options; no unresolved delinquent Federal Debt for Partial Claim / Combination / Payment Supplement)?
    program_review: Does the program account for the loss-mit eligibility conditions before any option is offered — no other FHA-insured real estate beyond stated exceptions; no FHA-claim-paid prior loan (except inheritance/co-signer-only) in 3 years; no debarment/suspension/LDP for the relevant home-retention option; no unresolved delinquent Federal Debt for Partial Claim/Combination/Payment Supplement?
    file_review: Spot-check ML-2025-12 loss-mit files; confirm documented Borrower-eligibility verification before the option was offered.
    judgment: false
    feeds:
      - hud-ml-2025-12-loss-mit-90-day-evaluation
    workflow_phase: servicing
    owner_role: loss_mitigation_specialist
    secondary_owner_role: default_servicing_analyst
    cadence: per-defaulted-loan
    consequence: ''
    tags:
      - round-b
      - regulator-direct
      - hud-ml
      - fha
      - servicing
      - loss-mitigation
      - borrower-eligibility
      - promoted
    primary_source:
      tier: 1
      authority: HUD ML 2025-12 — III.A.2.h.iii(A)
      source_class: hud-ml-pdf
      source_url: https://www.hud.gov/sites/dfiles/OCHCO/documents/2025-12hsgml.pdf
      snapshot_id: 31bf9e2b0c437c70
      fetched_at: '2026-05-22T11:23:07Z'
      content_hash: sha256:6376f97e582a3d32727a36ce337f620c5dcb731d0c6f561b66a893c5d00dff48
      paragraph_quote: |-
        The Mortgagee must verify that the Borrowers are eligible to participate in HUD’s 
        Loss Mitigation Program.
      drafter_attestation: |
        Copied verbatim from snapshot 31bf9e2b0c437c70 (content.txt) at
        2026-05-22T20:44Z. Substring is the (A) Eligibility to Participate
        in HUD Programs operative requirement from ML 2025-12; the four
        eligibility prongs are paraphrased in description.
    promoted_at: '2026-05-22T20:17:43+00:00'
    promoted_from: hud-ml-2025-12-roundb-v1.yaml
  - id: hud-ml-2025-12-loss-mit-90-day-evaluation
    canonical_id: hud-ml-2025-12-loss-mit-90-day-evaluation
    section: HUD ML 2025-12 — Loss Mitigation Program 90-Day Review (III.A.2.h.iii(B))
    description: |
      For each FHA-insured forward Mortgage in Default, [LENDER] must complete
      an evaluation of the Defaulted Mortgage for appropriate Loss Mitigation
      Options before four monthly installments are due and unpaid, and send
      a written Notice to Borrower with the determination of eligibility.
    type: do
    audit_question: For every FHA-insured forward Mortgage in Default, can [LENDER] evidence completion of the loss-mit evaluation before four monthly installments became due and unpaid, and delivery of the written Notice to Borrower with the determination of eligibility?
    program_review: Do the P&Ps ensure each defaulted forward Mortgage is evaluated for loss-mit options before four monthly installments are due and unpaid, with a written Notice to Borrower stating the eligibility determination?
    file_review: Pull defaulted forward-Mortgage files; confirm the evaluation completed before the 4th unpaid installment and the written Notice to Borrower with the determination.
    judgment: false
    feeds:
      - hud-ml-2025-12-permanent-home-retention-documents-15-days
    workflow_phase: servicing
    owner_role: loss_mitigation_specialist
    secondary_owner_role: default_servicing_analyst
    cadence: per-defaulted-loan
    consequence: ''
    tags:
      - round-b
      - regulator-direct
      - hud-ml
      - fha
      - servicing
      - loss-mitigation
      - 90-day-review
      - promoted
    primary_source:
      tier: 1
      authority: HUD ML 2025-12 — III.A.2.h.iii(B) 90-Day Review
      source_class: hud-ml-pdf
      source_url: https://www.hud.gov/sites/dfiles/OCHCO/documents/2025-12hsgml.pdf
      snapshot_id: 31bf9e2b0c437c70
      fetched_at: '2026-05-22T11:23:07Z'
      content_hash: sha256:6376f97e582a3d32727a36ce337f620c5dcb731d0c6f561b66a893c5d00dff48
      paragraph_quote: |-
        A Mortgagee is required to complete an evaluation of a Defaulted Mortgage for 
        appropriate Loss Mitigation Options before four monthly installments are due and 
        unpaid and send a written Notice to Borrower with the determination of eligibility.
      drafter_attestation: |
        Copied verbatim from snapshot 31bf9e2b0c437c70 (content.txt) at
        2026-05-22T20:44Z. Substring is the (B) 90-Day Review operative
        standard incorporated into Handbook 4000.1 III.A.2.h.iii(B) by ML
        2025-12.
    promoted_at: '2026-05-22T20:17:43+00:00'
    promoted_from: hud-ml-2025-12-roundb-v1.yaml
  - id: hud-ml-2025-12-permanent-home-retention-documents-15-days
    canonical_id: hud-ml-2025-12-permanent-home-retention-documents-15-days
    section: HUD ML 2025-12 — Execution of Permanent Home Retention Option Documents (III.A.2.i.iii(D))
    description: |
      For each Borrower who successfully completes a Trial Payment Plan (TPP)
      on a Permanent Home Retention Option (Standalone Partial Claim,
      Standalone Loan Modification, Combination Loan Modification and Partial
      Claim, or Payment Supplement), [LENDER] must send the Permanent Home
      Retention documents to the Borrower within 15 Days from the successful
      completion of the TPP.
    type: do
    audit_question: For every Borrower who successfully completed a TPP on a Permanent Home Retention Option under the ML 2025-12 framework, can [LENDER] evidence delivery of the Permanent Home Retention documents to the Borrower within 15 Days of TPP completion?
    program_review: Do the P&Ps ensure Permanent Home Retention documents are sent to the Borrower within 15 Days of successful TPP completion (Standalone Partial Claim, Standalone Loan Modification, Combination, or Payment Supplement)?
    file_review: Pull successful-TPP files; confirm Permanent Home Retention documents were sent within 15 Days of TPP completion.
    judgment: false
    feeds: []
    workflow_phase: servicing
    owner_role: loss_mitigation_specialist
    secondary_owner_role: default_servicing_analyst
    cadence: per-loss-mit-workout
    consequence: ''
    tags:
      - round-b
      - regulator-direct
      - hud-ml
      - fha
      - servicing
      - loss-mitigation
      - permanent-home-retention
      - tpp
      - promoted
    primary_source:
      tier: 1
      authority: HUD ML 2025-12 — III.A.2.i.iii(D)
      source_class: hud-ml-pdf
      source_url: https://www.hud.gov/sites/dfiles/OCHCO/documents/2025-12hsgml.pdf
      snapshot_id: 31bf9e2b0c437c70
      fetched_at: '2026-05-22T11:23:07Z'
      content_hash: sha256:6376f97e582a3d32727a36ce337f620c5dcb731d0c6f561b66a893c5d00dff48
      paragraph_quote: |-
        The Mortgagee must send the Permanent Home Retention documents to the Borrower 
        within 15 Days from the successful completion of a TPP.
      drafter_attestation: |
        Copied verbatim from snapshot 31bf9e2b0c437c70 (content.txt) at
        2026-05-22T20:44Z. Substring is the (D) Execution of Permanent Home
        Retention Option Documents 15-Day standard added by ML 2025-12.
    promoted_at: '2026-05-22T20:17:43+00:00'
    promoted_from: hud-ml-2025-12-roundb-v1.yaml
_promotion_history:
  - promoted_at: '2026-05-22T20:17:43+00:00'
    candidate_path: obligations\_remediation\_round_b_drafts\hud-ml-2025-12-roundb-v1.yaml
    candidates_promoted: 3
    candidates_skipped_existing: 0

Verbatim regulatory text (3)

Verbatim provisions from HUD Mortgagee Letter 2025-12 — each quote is a verified substring of the regulator-published source snapshot, not retyped. Quoted for reference; this is not legal advice. The operational layer (P&P updates, prompts) lives in the regulation update kits.

HUD ML 2025-12 — Eligibility to Participate in HUD Programs (III.A.2.h.iii(A))

The Mortgagee must verify that the Borrowers are eligible to participate in HUD’s Loss Mitigation Program.

Source: HUD ML 2025-12 — III.A.2.h.iii(A) · source URL · snapshot 31bf9e2b0c437c70

HUD ML 2025-12 — Loss Mitigation Program 90-Day Review (III.A.2.h.iii(B))

A Mortgagee is required to complete an evaluation of a Defaulted Mortgage for appropriate Loss Mitigation Options before four monthly installments are due and unpaid and send a written Notice to Borrower with the determination of eligibility.

Source: HUD ML 2025-12 — III.A.2.h.iii(B) 90-Day Review · source URL · snapshot 31bf9e2b0c437c70

HUD ML 2025-12 — Execution of Permanent Home Retention Option Documents (III.A.2.i.iii(D))

The Mortgagee must send the Permanent Home Retention documents to the Borrower within 15 Days from the successful completion of a TPP.

Source: HUD ML 2025-12 — III.A.2.i.iii(D) · source URL · snapshot 31bf9e2b0c437c70