www.hudclips.org U. S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT WASHINGTON, D. C. 20410-8000 November 7, 1988 OFFICE OF THE ASSISTANT SECRETARY FOR HOUSING- FEDERAL HOUSING COMMISSIONER Mortgagee Letter 88-31 TO: ALL APPROVED MORTGAGEES SUBJECT: Single Family Loan Production - Revised Form HUD 92900, Application for HUD/FHA Insured Mortgage The Form HUD 92900/VA 18O2a, Application for HUD Insured Mortgage or VA Loan Guaranty, has recently been revised. This is to inform you that use of this revised HUD 92900 for insured mortgages will become mandatory for applications signed by borrowers on or after January 29, 1989. At your discretion, you may use the revised form prior to January 29, 1989. The primary changes in the form are in Boxes 9A, 9B, 9C, 31A, 31C and Section IV, Notices to borrowers. The changes in these sections are generally self-explanatory. However, please note the following: 1. Box 9C requires the lender to check if the borrower is a first-time homebuyer. If the borrower will be an occupant and is also a first-time homebuyer, only the first-time homebuyer box need be checked by the lender. 2. Section IV, Notices to Borrowers, gives notice of all of the actions that can be taken by the lender or HUD against the borrower to collect delinquent payments. 3. Box 31C now asks for more detailed information about foreclosures or judgments on prior mortgages and loans. In addition, it requires the borrower to disclose whether he is delinquent or in default on any debt to the Federal Government. According to the OMB guidelines, any borrower that is presently delinquent or in default on any Federal debt is ineligible for any insured mortgage until the debt is brought current or satisfactory repayment arrangements have been made between the borrower and the Federal agency owed the debt. In addition, any person with a judgment lien against his property for a debt owed to the United States is not eligible for any HUD-insured mortgage until the judgment is paid or otherwise satisfied. This underwriting policy goes into effect upon use of the revised form and will be included in HUD Handbook 4155.1, Mortgage Credit Analysis, that is currently being rewritten and updated. Direct Endorsement lenders, if using the newly revised HUD 92900, must make one change when completing the Form HUD-54111, Request for Insurance Endorsement under the Direct Endorsement Program. In Box 7 of the HUD 54111, you must enter the one-digit code from Box 9C of the new HUD 92900. Please be sure your closing/insuring staff is aware of this change. Thank you for your cooperation in this matter. If you have any questions concerning this letter, please contact the Mortgage Credit Branch of your local Field Office or the Single Family Mortgage Credit Branch in HUD Headquarters at (202) 755-6700. Sincerely yours, Thomas T. Demery Assistant Secretary