FHA Mortgages

HUD Addresses FHA Mortgage Eligibility of DACA Recipients and Documentation Necessities For Sure Different Non-Everlasting Residents | Ballard Spahr LLP


The US Department of Housing and Urban Development (HUD) recently addressed FHA mortgage loan eligibility for recipients of Deferred Action for Childhood Arrival (DACA) in Mortgagee Letter 2021-12. As previously reported, at the end of the Trump administration, HUD announced that with effect from January 19, 2021, individuals who are DACA with the US Citizenship & Immigration Service (USCIS) and are legally entitled to work in the United States will join a Applying can apply to FHA mortgages.

In the mortgage letter, HUD addresses the FHA requirement that non-residents of the United States are not eligible for FHA-insured mortgage financing. HUD declares that “[t]its requirement was included in the policy, but the FHA recognizes that it was not terminology that had a clear, consistent meaning. ”After briefly considering the history and scope of DACA, the HUD then determines that“ the requirements the FHA for ‘lawful residence’ before the establishment of DACA ”deferred measures and entitlement to work permit. Because of this confusion, as announced in FHA INFO # 21-04 under the previous administration, the FHA completely waived Manual 4000.1 Section II.A.1.b.ii (A) (9) (c) to provide more information Clarity regarding FHA-insured mortgage funding eligibility for DACA recipients for endorsements on or after January 19, 2021. “

HUD also deals with work permit documentation requirements for citizens of the Federated States of Micronesia, the Republic of the Marshall Islands, and the Republic of Palau, as well as those with H-1B nonimmigrant classification and maintaining H-1B status. In particular, the documentation requirements for non-permanent residents in HUD Manual 4000.1 have been revised as follows:

“[T]The borrower is eligible to work in the United States provided the borrower provides:

  • a work permit document (USCIS Form I-766) showing that the work permit status is up-to-date;
  • a USCIS Form I-94 proving H-1B status and proof of employment by the authorized H-1B employer for at least one year;
  • Proof of USCIS granting refugee or asylum status; or
  • Proof of citizenship of the Federated States of Micronesia, the Republic of the Marshall Islands or the Republic of Palau. “