FHA announced a new policy last week on FHA loans that enter forbearance BEFORE FHA insures the loan for us. Realize this insurance process can take 30-90 days. FHA will now insure these loans for us; but THERE IS A CATCH. Under the terms of the new policy, lenders must provide an indemnification agreement to FHA for 20% of the original mortgage amount, which only becomes payable if the mortgage goes into foreclosure and results in a claim to the FHA Mutual Mortgage Insurance Fund.
This means that on a $350k loan we as the lender are responsible for $70k of the losses on that loan. Gee thanks FHA! The federal government makes it super easy to claim forbearance then we as the lender have-to pay for our government's stupid mistake.
The Community Home Lenders Association predicts that lenders will create additional credit overlays based of Fico scores, the type of job the borrowers hold, and other factors.