Rules aim to ease burdens while safeguarding homeowners
The Community Home Lenders of America (CHLA) voiced strong support for new guidance issued by the Federal Housing Administration (FHA) that aims to ease servicing burdens for lenders while maintaining critical protections for distressed homeowners.
The announcement follows the release of FHA’s Mortgagee Letter 2025-14, which provides updates to servicing standards for FHA-insured loans. According to FHA, the revised rules will help ensure that mortgage servicers can reach borrowers more effectively, clarify regulatory obligations, and streamline compliance—all without compromising efforts to prevent foreclosure.
“The Community Home Lenders of America commends FHA for thoughtfully eliminating unnecessarily burdensome servicing rules while preserving the critical duty of servicers to work with distressed borrowers to avoid foreclosure,” said Scott Olson, CHLA executive director, in a statement. “This is a meaningful step toward aligning compliance with practical servicing realities—particularly for independent mortgage banks that are on the front lines of helping borrowers stay in their homes.”
Mortgagee Letter 2025-14 builds on FHA’s previous guidance from December 2024, which encouraged remote borrower engagement following the success of digital outreach during the COVID-19 pandemic. The latest changes, effective July 1, 2025, refine those policies to better reflect the needs of both servicers and borrowers.
Key updates include expanded requirements for borrower contact, clearer alignment with Regulation X, and technical corrections to loss mitigation policy. Notably, the letter also prohibits servicers from charging borrowers for basic servicing activities such as conducting interviews, providing payoff statements, and recording mortgage satisfaction in applicable states.
CHLA, a national non-profit organization representing small and mid-sized community mortgage lenders, welcomed the updated rules as part of an ongoing effort to reduce regulatory friction while advancing sustainable homeownership. The group emphasized the importance of fair and practical regulation that allows lenders to provide quality services and access to credit at the community level.
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