The Federal Housing Administration (FHA) is proposing a new structure, called Reinstatement Advance Payment (RAP), that would change how servicers document and service partial claims and payment supplements. 

Under the draft, attributed to Joseph M. Gormley, who is performing the delegable duties of the assistant secretary for housing–federal housing commissioner, the FHA would test a model that eliminates the traditional zero-interest subordinate lien used today for partial claims.

Instead, servicers would advance funds on the borrower’s behalf and add a non-interest-bearing balance to the existing FHA-insured first mortgage. The borrower would sign a RAP repayment agreement rather than a separate details ⇒

BusinessMediaguide.Com portal received this content from this noted web source: HousingWire.Com