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HUD Rescinds ML 2008-38 Non-Recourse Clarification 

Apr 06, 2011By

In a first public action since taking leadership of the FHA, Acting FHA Commissioner Robert Ryan signed the Department of Housing and Urban Development's Mortgagee Letter 2011-16  rescinding Mortgagee Letter 2008-38 that clarified their interpretation of the HECM non-recourse provisions to not include non-arm's length transactions.   In rescinding ML 08-38, ML 11-16 states that the intent of the previous guidance was to "supplement and explain provisions contained in the at 24 CFR §206.125 and HUD Handbook 4235.1 (Home Equity Conversion Mortgages)."  The action is the result of "uncertainty regarding the guidance," and HUD plans to issue new guidance

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