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HUD’s regulations currently include complex prohibitions and exceptions to restrictions on conveyances and assumability of FHA mortgages. The Housing Opportunity Through Modernization Act of 2016, (Pub. L. 114-201) (HOTMA), requires that HUD’s regulations on private transfer fees, previously prohibited as restrictions on conveyances, conform with the policy imposed by the Federal Housing Finance Agency (FHFA) for loans purchased by Federal National Mortgage Association (Fannie Mae) and Federal Home Loan Mortgage Corporation (Freddie Mac). Additionally, such prohibitions may be burdensome to implement for programs designed to promote affordable homeownership, and HUD frequently processes stakeholder inquiries about free assumability questions. FHA participants across the country routinely submit questions about covenant provisions in borrower transactional documents, adding time to their transaction and highlighting areas that should be updated in the regulation. This rule proposes to revise HUD’s requirements on conveyances and assumability to conform with the FHFA requirements for private transfer fees and further streamline the process to allow for free assumability in a less costly and burdensome fashion and provide for updates based on FHA participant feedback.