The Federal Housing Administration rescinded and will delay a rule that as of April 1 prohibited borrowers with more than $1,000 in disputed collections accounts from getting a federally backed mortgage, according to a notice sent late Friday.

FHA postponed the rule until July, and will take public comment from lenders, builders and others in the industry until then to clarify guidance.

"There is clearly a bigger ripple effect here than the Department of Housing and Urban Development might have anticipated going into this revision," said Lisa Jackson, senior vice president of research and business development with John Burns Real Estate Consulting. "Any measure that impacts even 10% of sales is meaningful and our analysis shows it would be far greater in some markets."

The FHA attempted to ease the original proposal, allowing borrowers to provide written documentation on "life event" disputed accounts with them, such as bills stemming from illness, divorce or unemployment in order to obtain an exemption.

Borrowers could previously show the lender they arranged a payment plan to settle other accounts too in order to qualify, including credit card and utility bills.

According to the alert sent Friday, the FHA ensured lenders they would not be in violation of the new rule for loans written between April 1 and April 8.

Until July, the old guidance will be put back into place.

Analysts from JPMorgan Chase (JPM) said the rule would affect many first-time homebuyers the most, those most likely to carry such debt. The analysts estimated the rule could cut FHA demand by up to 20%, and the damage would affect homebuilders differently depending upon how much of their business hinged on these borrowers.

Many questioned the timing and the murkiness of the rule. The FHA previously said it adopted the rule in order to reduce default risk for newer books of business. Mortgages written during the housing bubble continue to haunt the agency. The FHA emergency Mutual Mortgage Insurance fund dropped to nearly 0.2% last year was in danger of needing a bailout from the Treasury Department if insurance premiums were not hiked and some lucrative settlements were not struck.

"There are two positives to this latest decision: HUD is willing to analyze the real implications of the housing market before they put a new measure in place, plus they are engaging feedback on the issue," Jackson said.