HUD Revises Handbook 4000.1 to Remove Branch Registration Requirements

On March 19, 2024, HUD published Mortgagee Letter 2024-04, effective immediately, which primarily removes the requirements from Handbook 4000.1 that an FHA-approved mortgagee must register its branches with FHA, in keeping with a final rule (the Final Rule) adopted by HUD on February 2, 2024 (see WBK’s article on HUD’s elimination of the branch registration requirement).

Pursuant to these changes (as well as the Final Rule), FHA-approved mortgagees may, but are no longer required to, register their branches with FHA.  Choosing to register branches (as the Final Rule notes) means that those registered branches will appear on the HUD Lender List Search page, but mortgagees will have to pay recertification fees for each such registered branch.  Non-registered branches may still conduct FHA business, and the mortgagee will not incur fees for such branches, but they will not appear on the Lender List Search page.  Regardless of registration status, all branches where FHA business is conducted must still meet certain ongoing requirements, such as licensing requirements and HUD’s requirements for office facilities.

The Mortgagee Letter notes that these changes will not impact the 2023 recertification because these changes take effect after the recertification period for mortgagees who have a December 31, 2023, fiscal year end.