HUD issues rule to pay partial claims under Section 232 insurance program
The Federal Housing Administration has announced the criteria and process by which it will accept and pay partial payment claims under FHA's Section 232 mortgage insurance contracts, the agency announced Monday.
“Through acceptance and payment of a partial payment of claim, FHA pays the lender a portion of the unpaid principal balance and recasts a portion of the mortgage under terms and conditions determined by FHA, as an alternative to the lender assigning the entire mortgage to HUD,” explained Carol J. Galante, Acting Assistant Secretary for Housing-Federal Housing Commissioner. “Partial payment of claim also allows FHA-insured healthcare projects to continue operating and providing services."
The Section 232 program insures mortgage loans to facilitate the construction, substantial rehabilitation, purchase, and refinancing of nursing homes, intermediate care facilities, board and care homes, and assisted-living facilities.
The rule was published Friday in the Federal Register. The full notice can be found by clicking here.