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Demystifying HUD Partial Payment Claims: What Realtors Need to Know

Updated: May 17

In the wake of the COVID-19 pandemic, the housing market faced unprecedented challenges. Many homeowners found themselves struggling to make mortgage payments, facing the looming threat of foreclosure. However, amidst this turmoil, the Department of Housing and Urban Development (HUD) introduced a crucial lifeline: the HUD Partial Payment Claim. In this blog post, we'll delve into what exactly a HUD Partial Payment Claim is, and how it became a beacon of hope for homeowners during the pandemic.

Understanding HUD Partial Payment Claims

HUD Partial Payment Claims, also known as PPCs, are a form of relief available to homeowners with FHA-insured mortgages who are experiencing financial hardship and are at risk of default. When a borrower falls behind on mortgage payments, the lender has the option to file a Partial Claim with HUD on the homeowner's behalf. This claim covers the past-due amounts, allowing the homeowner to bring their mortgage current without the threat of foreclosure.

How COVID-19 Relief Utilized Partial Payment Claims

The onset of the COVID-19 pandemic brought about widespread economic uncertainty, leading to job losses, reduced income, and financial instability for millions of Americans. Recognizing the urgency of the situation, HUD swiftly implemented measures to assist struggling homeowners, leveraging Partial Payment Claims as a key component of its relief efforts.

One notable initiative was the introduction of the COVID-19 National Emergency Partial Claim, specifically designed to help homeowners impacted by the pandemic. Under this program, eligible borrowers could request a Partial Claim to bring their mortgage current, even if they were unable to resume making full mortgage payments due to COVID-related hardships.

Benefits of HUD Partial Payment Claims

HUD Partial Payment Claims offer several benefits for both homeowners and lenders:

  1. Avoiding Foreclosure: By bringing the mortgage current, Partial Payment Claims help homeowners avoid the devastating consequences of foreclosure, allowing them to remain in their homes.

  2. Preserving Homeownership: For many homeowners, their property represents not just a financial investment but a place of security and stability for their families. Partial Payment Claims help preserve homeownership by providing a pathway to overcome temporary financial setbacks.

  3. Streamlined Process: HUD has streamlined the process for lenders to file Partial Payment Claims, making it more efficient for homeowners to access this form of relief when they need it most.


In times of crisis, innovative solutions are needed to support individuals and families facing financial hardship. HUD Partial Payment Claims emerged as a vital tool in the arsenal of COVID-19 relief efforts, offering a lifeline for homeowners struggling to make ends meet. As we continue to navigate the challenges posed by the pandemic, it's essential for homeowners to be aware of the resources available to them, including the option of HUD Partial Payment Claims. By leveraging these resources effectively, we can work towards a more stable and secure future for homeowners across the country.

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