Mortgage Servicing and Loan Modifications: 12.3.6.4.2 COVID-19 Advance Loan Modification
The COVID-19 Advance Loan Modification (ALM) provides eligible borrowers with a 25% reduction of their monthly principal and interest payment through preset loan modification terms.390 Borrowers do not apply for the ALM. Instead, during a specified period, servicers review their FHA-insured loan portfolio for loans that would achieve the ALM target payment through the modification.391 The servicer will send the ALM modification offer to borrowers who meet the eligibility guidelines.