Handbook 4000.1 Update 18 — what changed
Issued2026-08-12
May be implementednow, at the Mortgagee’s option
Must be implemented2026-11-10
HUD’s transmittal states the changes “may be implemented immediately, but must be implemented no later than November 10, 2026”. Until that date there are two correct answers for every revised section: the text in force today, and the Update 18 revision. Sections tied to a specific Mortgagee Letter take that letter’s own date instead and are not covered by the blanket option.
Our corpus diff. Comparing the corpus before and after Update 18, section
by section:
- 285 changed
- 178 missing in new
- 145 new in update
- 103 unchanged
This diff is ours, not HUD’s. missing in new and new in update mean a section heading could not be matched across the two editions — usually a renumbering, not a deletion. Treat them as “look here”, never as “this rule is gone”.
Changes by Part
Section I – Doing Business with FHA 5
| Section | Title | What HUD says changed | ML |
|---|---|---|---|
I.A.3.c.iv(B)(2)(b) | Officer in Charge – Standard | Updated requirements related to FHA Mortgagee approval and quality control, per ML 2026-09. | ML 2026-09 |
I.A.5.a.iv(D) | Principal/Authorized Agent Relationship – Exception | Added exception to align with existing policy for Assumption underwriting in II.A.8.n.v(C). | — |
I.A.11 | Sale of a Beneficial Interest in a Group of Mortgages | Added requirements for the Sale of a Beneficial Interest in a group of Mortgages as an entirety and submission of a Declaration of Trust, per ML 2026-02. | ML 2026-02 |
I.B.1.c.ii(A); I.B.1.c.ii(B); I.B.1.d; I.B.1.e | Form HUD-92563-A, Application for Roster Personnel Designation;; State Certification;; Renewal and Maintenance;; Post-approval Requirements | Updated policies and procedures for FHA Appraiser Roster management, per ML 2025-24. | ML 2025-24 |
I.B.4.b.iii(B)(3)(a) | Secondary Financing – Restrictions on Conveyance – Standard | Added reference to Legal Restrictions on Conveyance guidance. | — |
Section II – Origination through Post-closing/Endorsement 11
| Section | Title | What HUD says changed | ML |
|---|---|---|---|
II.A.1.a.ii(A)(2) | HUD Required Disclosures – Form HUD-92900-B, Important Notice to Homebuyers | Removed the requirements for Mortgagees to provide Borrowers with form HUD- 92900-B, Important Notice to Homebuyers, and to obtain the executed form, per ML 2026-07. | ML 2026-07 |
II.A.1.a.iii(B)(2); II.A.8.p.iii(D)(2); II.C.3.b.iv | Holds Tracking;; Single-Unit Approval Case Number Assignment;; Submission Process | Aligned procedural guidance with recent system updates. | — |
II.A.1.a.iii(B)(6); II.A.1.a.iii(B)(10); II.A.1.b.iv(A)(1); II.B.2.b.iii(A)(4); II.A.1.b.iv(B)(7)(a); II.A.8.p.ii(J)(1); II.B.2.b.iii(B)(7)(a); II.B.8.c.ii(I)(1); II.D.5.a; II.A.2.a.ii | Ordering Appraisals Refined requirements for reusing an appraisal. 143; Ordering an Update to an Appraisal Refined requirements for ordering an appraisal update. 148; Property Eligibility and Acceptability Criteria – Special Flood Hazard Areas;; Special Flood Hazard Areas Refined requirements for properties in Special Flood Hazard Areas (SFHA). 162, 575; Manufactured Housing – Definition;; Manufactured Housing – Definition;; Manufactured Housing – Definition;; Manufactured Housing – Definition;; Property Acceptability Criteria for Manufactured Housing for Title II Insured Mortgages – Definitions Refined definition of Manufactured Housing for consistency throughout Handbook. 172–173, 506, 582, 756, 848–849; Nationwide Mortgage Limits | Updated the forward mortgage loan limits section to include an evergreen hyperlink in lieu of including loan limits in the handbook annually. | — |
II.A.3.a.ii(N)(2)(b); II.A.3.a.ii(N)(3)(b); II.A.8.i.vii(A)(6)(b); II.B.4.a.ii(B)(15)(b)(ii); II.B.4.a.ii(B)(15)(c)(ii); II.B.8.a.vi(E)(1)(f)(ii); II.A.4.a.i; II.A.4.e.iii; II.A.5; II.A.5.d.x(B); II.A.5.d.x(D); II.A.8.d.vi(C)(4)(d) | Individual Water Supply Systems (Wells) – Required Documentation;; Shared Wells – Required Documentation;; Individual Water Supply Systems (Wells) – Required Documentation;; Individual Water Supply Systems (Wells) – Required Documentation;; Shared Wells – Required Documentation;; Individual Water Supply Systems (Wells) – Required Documentation Refined language for valid water test for consistency. 189, 192, 472, 601, 604, 729; Use of TOTAL Mortgage Scorecard;; HUD Employee Mortgages (TOTAL);; Manual Underwriting of the Borrower;; Documentation of Final Underwriting Review Decision;; HUD Employee Mortgages;; HUD Employee Mortgage | Removed requirements for HUD Employee Loans to be submitted to FHA for underwriting and endorsement. 200, 278–279, 363–364, | — |
II.A.4.c.ii; II.A.5.b.ii; II.B.5.e.ii(A) | Employment Related Income (TOTAL);; Employment Related Income (Manual);; Employment Income | Added definitions for Written Verification of Employment, Electronic Verification of Employment, and Reverification of Employment. 223–225, 302–304, | — |
II.A.4.d.iii(J)(1)(b); II.A.5.c.iii(J)(1)(b); II.A.4.d.iii(L)(2); II.A.5.c.iii(L)(2); II.A.7.d.iii(B); II.B.7.d.iii(B) | Secondary Financing Provided by Governmental Entities and HOPE Grantees (TOTAL) – Standard;; Secondary Financing Provided by Governmental Entities and HOPE Grantees (Manual) – Standard Refined language to reflect that the prohibition on secondary financing having a balloon payment within the first 10 years does not apply to the Federal Home Loan Bank (FHLB) Homeownership Set-Aside Programs. 264, 343–344; Federal Home Loan Bank Homeownership Set-Aside Program (TOTAL);; Federal Home Loan Bank Homeownership Set-Aside Program (Manual) Refined language to reflect that FHLB Homeownership Set-Aside funds may be provided either as a grant or as secondary financing. 271–272, 351 4; Assignee Mortgagee;; Assignee Mortgagee | Removed obsolete content to reflect current practices. | — |
II.A.7.d.iv; II.B.7.d.iv | Ineligible for Endorsement – Non-lender Insured;; Ineligible for Endorsement | Removed obsolete content to reflect current practices. | — |
II.A.7.d.vi(A) | Severe Case Warnings | Removed obsolete content to reflect current practices. | — |
II.A.8.a.vii(B); II.A.8.a.xviii(C)(1)(d)(i); II.A.8.a.xviii(C)(1)(d)(ii); II.A.8.a.xvi | Limited 203(k) Ineligible Improvements/Repairs;; Standard 203(k) Release of Funds;; Limited 203(k) Release of Funds Refined the maximum number of allowable draws under the Limited 203(k) program and updated draw disbursement procedures, per ML 2026-06. 400, 419–420; Data Delivery/203(k) Calculator | Removed obsolete content to reflect current practices. | — |
II.A.8.p.iii(C) | Single-Unit Approval – Property Eligibility | Added reference to Legal Restrictions on Conveyance guidance. | — |
II.E.4.g.ii(N)(2) | Procedures for Endorsement – Assembly of Case Binder – Case Binder Stacking Order | Updated stacking order to be consistent with pre-closing documentation requirements. | — |
Section III – Servicing and Loss Mitigation 19
| Section | Title | What HUD says changed | ML |
|---|---|---|---|
III.A.2.d.ii(A) | Application of Partial Payments Totaling a Full Monthly Payment – Standard | Updated to align with waiver, Handbook 4000.1 Waiver of Date of Default Language in Section | — |
III.A.2.d.ii(A); III.A.2.h.iii(A)(2); III.A.2.i | Application of Partial Payments Totaling a Full Monthly Payment under Partial Payments for Mortgages in Default, issued on 12/11/2025. 1179–1180; Non-Borrowers Who Acquired Title through an Exempted Transfer Reorganized bullets to consolidate requirements for a Permanent Retention Option. 1195; Loss Mitigation Home Retention Options | Removed obsolete content for COVID-19 loss mitigation options. | — |
III.A.2.i.ii(B)(6) | Expiration of Forbearance Agreement | Added verbiage for an automatic extension in the event of Forbearance expiration. | — |
III.A.2.i.iii(C)(1); III.A.2.i.iii(C)(2); III.A.2.i.iii(C)(5)(A) | Trial Payment Plans – Definitions;; Trial Payment Plans – Standard;; Trial Payment Plan Failure – Standard | Updated requirements for Trial Payment Plans (TPP), per ML 2026-08. | ML 2026-08 |
III.A.2.i.vii(B)(1); III.A.2.j.ii(C)(1)(b) | Mortgage Status Refined Mortgage Status to remove maximum arrearage. 1240 5; Standard PFS – Standard | Updated to align with waiver, Handbook 4000.1, Section | — |
III.A.2.j.ii(C)(1)(b); III.A.2.j.ii(E)(1)(c) | Standard PFS Standards, issued on 12/11/2025. 1245; PFS Request for Damaged Property | Updated to reflect variance requests are submitted in EVARS. | — |
III.A.2.p.i(C) | When to Initiate Foreclosure | Updated requirements for reviewing Borrowers for Loss Mitigation Options, per ML 2026-08. | ML 2026-08 |
III.A.2.p.i(D)(1)(b) | Prohibition of Foreclosure due to State Legislation | Updated to improve readability. | — |
III.A.2.p.i(D)(1)(c) | Prohibition of Foreclosure due to Federal Law or Regulations | Added verbiage for an automatic extension. | — |
III.A.2.p.i(D)(1)(d) | Prohibition of Foreclosure due to Bankruptcy | Added verbiage for an automatic extension. | — |
III.A.2.p.ii(E)(2) | Reasonable Diligence in Completing Foreclosure – Standard | Updated to add that Mortgagees must not file an EVARS request for automatic extensions. | — |
III.A.2.p.iii; III.A.4.a.ii(G)(6) | Foreclosure Sales and Post- Foreclosure Sales Efforts;; Reporting Foreclosure/CWCOT Outcomes | Updated requirements for bidding at a foreclosure sale and for utilizing Claims Without Conveyance of Title (CWCOT), per ML 2026-03. | ML 2026-03 |
III.A.2.q.viii(B) | Evictions and Eviction Personnel – Required Documentation | Updated to specify eviction costs be reasonable and customary. | — |
III.A.3.c.iii(A)(1) | Title Evidence Package | Updated HUD mailing address to send title evidence package. | — |
III.A.3.f.i(C) | Active Duty Military Service | Updated Good Neighbor Next Door Owner-Occupancy policy for military servicemembers on Active Duty. | — |
III.A.3.i.ii; III.B.1.r.iii(A) | HUD Postponement of Principal Payments for Servicemembers Reinstated section on requirements for postponement of principal payments for Servicemembers that was inadvertently deleted. 1354–1355; Compliance Package | Updated compliance package list to add most recent LESA analysis and notice to Borrower. | — |
III.B.1.r.v | Completing the Assignment Process | Updated to reflect document delivery requirements for assignments. | — |
III.B.1.t.ii(A)(2) | Incurable Defects | Added criteria for assignment claims and repurchase. | — |
III.B.2.f.i(F)(2)(b); III.B.2.f.i(F)(3) | Mortgages Endorsed after January 23, 2004, that have a Due and Payable Date on or after September 19, 2017, and before September 28, 2024 Reinstated section on Debenture Interest that was inadvertently deleted. 1504 6; Debenture Interest Rate Adjustment | Deleted this section because this has expired as of July 1, 2025. | — |
Section IV – Claims and Disposition 4
| Section | Title | What HUD says changed | ML |
|---|---|---|---|
IV.A.2.a.ii(L)(2); IV.A.2.d.ii(F); IV.A.2.d.iii | Foreclosure and Acquisition Costs – Standard;; Foreclosure and Acquisition Costs;; Submission of Claim Form Parts to HUD for CWCOT | Updated requirements for bidding at a foreclosure sale and for utilizing Claims Without Conveyance of Title (CWCOT), per ML 2026-03. | ML 2026-03 |
IV.A.2.p; IV.A.2.q | Claim Type 33 - Payment Supplement;; Claim Type 33 - Disaster Payment Supplement | Updated requirements to account for delays due to bankruptcy. | — |
IV.B.2.f.vi(B) | Extended Listing Period – Standard | Updated to reflect properties will move to extended listing period if no bid is accepted during the exclusive listing period. | — |
IV.B.2.j.ii | Repairs Necessary to Comply with Mortgage Lender or State, Tribal, or Local Law Requirements | Updated to reflect repairs may be made by HUD if the request has been approved. | — |
Section V – Quality Control, Oversight, and Compliance 5
| Section | Title | What HUD says changed | ML |
|---|---|---|---|
V.A.2.b.i(A); V.A.2.b.i(A)(2); V.A.2.c | Training;; Access to FHA Guidance;; Identifying Patterns | Removed requirements related to FHA Mortgagee approval and quality control, per ML 2026-09. | ML 2026-09 |
V.A.3.a.iv(B) | Sample Composition Standard – Early Payment Defaults | Updated requirements related to FHA Mortgagee approval and quality control, per ML 2026-09. | ML 2026-09 |
V.A.3.c.ii(C) | Property and Appraisals | Updated FHA quality control requirements to allow greater flexibility and alternatives to appraisal field reviews, per ML 2026-10. | ML 2026-10 |
V.E.5.e.i(B)(1); V.E.5.e.i(C) | Remedial Education – Standard;; Removal | Updated policies and procedures for FHA Appraiser Roster management, per ML 2025-24. | ML 2025-24 |
II.A.4; II.A.5; II.A.8.d; II.B.5.b.iii(C)(3); II.B.5.d.iii(G)(4); II.E.2.d.i(D)(6)(d); II.E.4.d.i(D)(6)(d); III.A.2.i | Underwriting the Borrower Using the TOTAL Mortgage Scorecard (TOTAL);; Manual Underwriting of the Borrower;; Refinances;; Evaluating Credit History – Required Documentation;; Calculation of Monthly Obligation;; Calculation of Monthly Obligation;; Calculation of Monthly Obligation;; Loss Mitigation Home Retention Options; Appendix 8.0 – FHA Defect Taxonomy | Removed obsolete content for COVID-19. N/A Various technical edits including procedural updates, hyperlinks, punctuation, formatting, grammar, spelling, and capitalization. Throughout 3. Implementation: Below is a list of effective dates for the Handbook changes: Handbook changes identified in Section 2 of this Transmittal incorporated to reflect a Mortgagee Letter Effective as previously announced in the corresponding Mortgagee Letter. All other changes May be implemented immediately, but must be implemented no later than November 10, 2026. 4. Public Feedback: HUD welcomes feedback from interested parties and will consider the feedback in determining the need for future updates. Any feedback or questions may be directed to the FHA Resource Center at 1-800-CALL FHA (1-800-225-5342), [email protected], or www.hud.gov/answers. The FHA Resource Center is prepared to accept calls from persons who are deaf or hard of hearing, as well as individuals with speech or communication disabilities. Information on how to make an accessible phone call is available at https://www.fcc.gov/consumers/guides/telecommunications-relay-service-trs. | — |
Take the data
Coverage note. Two controlling Mortgagee Letters named by HUD's
transmittal — ML 2025-24 and ML 2026-02 — are not
yet in this corpus, so they appear above without a link. Every other ML cited here is
published in full.
The same material as files, so you can diff it against your own P&P register: changes.csv · per-section diff.csv · section map.csv
Every revised section is also published in the corpus with both texts side by side — the version in force today and the Update 18 revision — each labelled with its own date. Start at Handbook 4000.1.