source:
  type: guide
  id: usda-hb-3555-18.5
  authority: USDA SFH Guaranteed Loan Program Technical Handbook HB-1-3555 ¶18.5 —
    Loss Mitigation Options
  description: USDA SFH Guaranteed Loan Program Technical Handbook HB-1-3555 ¶18.5
    — Loss Mitigation Options.
  coverage_tier: operative
obligations:
- id: usda-hb-3555-18.5-full
  canonical_id: usda-hb-3555-18.5-full
  section: USDA SFH Guaranteed Loan Program Technical Handbook HB-1-3555 ¶18.5 — Loss
    Mitigation Options
  type: do
  tags:
  - regulator-direct
  - usda
  - usda-handbook
  - corpus-expansion
  - tier-operative
  primary_source:
    tier: 1
    authority: USDA SFH Guaranteed Loan Program Technical Handbook HB-1-3555 ¶18.5
      — Loss Mitigation Options
    source_class: usda-handbook
    source_url: https://www.rd.usda.gov/sites/default/files/hb-1-3555_consolidated.pdf
    snapshot_id: 0466acd1ea2d17a4
    fetched_at: '2026-05-25T14:10:13Z'
    content_hash: sha256:22ac6f998ff72578e318fca138ebe80fb18ae2fc701eb5936172f1842679a13a
    paragraph_quote: '18.5 LOSS MITIGATION OPTIONS The servicer will make every possible
      effort to assist borrowers who are experiencing an involuntary inability to
      pay their mortgage and show cooperation to resolve default situations using
      appropriate loss mitigation tools. Loss mitigation options include informal
      repayment agreements, special forbearance agreements, or loan modifications.
      Special forbearance agreements and loan modifications should be used when information
      in the servicing file supports the borrower’s ability and willingness to pay.
      Mortgage Recovery Advance (MRA) can be used to satisfy a borrower’s delinquency
      and bring the borrower current. A voluntary liquidation method such as a pre-foreclosure
      sale or a deed-in-lieu of foreclosure may be used to protect the Government’s
      interest once the servicer has examined other servicing options and determined
      the borrower cannot continue with the loan obligation. Traditional loss mitigation
      options must be exhausted prior to use of Streamline Options. Consideration
      must be given to all options prior to initiation of liquidation. The servicer
      must attempt to obtain information on the borrower’s financial condition and
      make an informed determination of the borrower’s ability to repay the arrearage
      and continue making mortgage payments as scheduled. Details on consideration
      and processing the below actions are located in the Attachment 18-A, The Loss
      Mitigation Guide: HB-1-3555 (03-09-16) SPECIAL PN 18-6 Revised (04-14-25) PN
      637 Guidance documents lack the force and effect of law, unless expressly authorized
      by statute or incorporated into a contract. USDA may not cite, use, or rely
      on any guidance that is not available through their guidance portal, except
      to establish historical facts. x Servicing Early Delinquent Loans x Informal
      Repayment Agreement x Loss mitigation overview x General policies, procedures
      and minimum actions that constitute effective loss mitigation techniques x Special
      Forbearance x Loan Modification x Mortgage Recovery Advance (unrecorded) x Pre-Foreclosure
      Sale x Deed-in-Lieu of Foreclosure x Servicing plan, checklists; disposition
      cost benefit analysis x Reporting – ESR and status of mortgage codes. All servicers
      must submit loss mitigation information through USDA LINC https://usdalinc.sc.egov.usda.gov/RHShome.do.
      SECTION 3: CUSTODIAL PROPERTY [7 CFR 3555.306]'
  judgment: false
