WASHINGTON — Senate Banking Committee Chairman Tim Johnson, D-S.D., and Elizabeth Warren, D-Mass., are urging the Federal Housing Administration to change an employment eligibility requirement for borrowers looking to modify their mortgages.

The Democratic lawmakers requested in a letter Tuesday that a provision in an agency mortgagee letter effective March 15, 2013, which stipulated that borrowers must be "currently employed" to qualify for an FHA loan modification, be removed.

"While verifying employment is an understandable requirement if a borrower's income source is employment, the 'currently employed' requirement discriminates against the many Americans who have stable and verifiable sources of income apart from employment: seniors with personal retirement accounts, Social Security benefits, or survivor benefits; disabled individuals with disability benefits or Social Security Disability Insurance; veterans with veterans' benefits; and single mothers receiving alimony or child support," Johnson and Warren said in the letter to FHA Commissioner Carol Galante. "The 'currently employed' requirement may prevent these individuals participating in FHA's loan modification program, and, as a result, may cause them to lose their homes."

Johnson and Warren asked the FHA to clarify the provision to "make clear that borrowers who rely exclusively on unearned income sources are not categorically excluded from FHA's loan modification program." They also requested that the agency review recent applications from individuals who may have been excluded due to the source of their income.

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