The FHA is urging Congress to restore the authority of community banks to close FHA loans in their own names without having to maintain an FHA lender approval to do so. While it took a regulation by the Department of Housing and Urban Development to take away small banks’ FHA correspondent status, federal law requires lenders to have FHA approval before they can close an FHA-insured loan. Only Congress can make the changes necessary for non-direct endorsement lenders to return to the business of originating and closing FHA loans in their name, according to a former HUD official. Assistant Secretary for Housing and...

FHA lenders that fail to report mortgage record changes for mortgage sales, transfers and termination of mortgage insurance will be referred to the Mortgage Review Board for disciplinary action, including civil fines, the agency warned. In Mortgagee Letter 2011-33, the FHA reminded lenders of their responsibility to reconcile their portfolios and ensure all accounts are properly identified. When the FHA’s records do not match lenders’ records, the latter are required to take corrective action. The Department of Housing and Urban Development will not pay any claims if the name and identification number of the holder or the...

A House Republican legislative proposal to transfer the Department of Agriculture’s rural housing programs to the FHA to eliminate potentially duplicative housing services would be disruptive if not premature, according to officials from both agencies. Testifying during a recent House subcommittee hearing on a GOP discussion draft to reform FHA, Ginnie Mae and the Rural Housing Service of the Department of Agriculture, agency representatives expressed their opposition to the proposal. The Republican discussion draft is under consideration in the House Financial Services Subcommittee on Insurance, Housing and Economic Opportunity to...

The Department of Housing and Urban Development is seeking public comment on a plan to eliminate an outdated appeals process, which HUD used to collect data to set FHA mortgage loan limits. Since the early 1980s, HUD has allowed interested parties to submit appeals for a higher FHA loan limit in any area of the country at any time in lieu of the limits set by the department for FHA loans. The process, however, is no longer in use – a victim of advances in data-collection technology. Previous guidance issued by HUD outlined the appeal process and later added requirements for data used in non-disclosure states as well as...

The Department of Housing and Urban Development recently called upon lawmakers to restore funding for its housing counseling, a key eligibility requirement for borrowers under the FHA’s Home Equity Conversion Mortgage program. Deborah Holston, HUD acting deputy assistant secretary for single-family housing, told members of the House Financial Services Subcommittee on Insurance, Housing and Community Opportunity that the department has identified ways to streamline and improve the housing counseling program. House appropriators did not restore funding for the program in the draft FY 2012 appropriations bill released...

Granting the chief financial officer additional oversight authority as proposed by House Republicans would be excessive for a relatively small agency such as Ginnie Mae, the agency’s president told lawmakers. Testifying during a recent House subcommittee hearing on legislative proposals on FHA and Ginnie Mae reform, Ginnie Mae President Ted Tozer said that while he understands the committee’s concerns about the agency’s financial condition, he believes the provision is not necessary. Among other things, the proposal would give Ginnie Mae’s CFO a greater hand in overseeing operations to ensure that the agency is not...

Ginnie Mae has named PricewaterhouseCoopers as “Securitized Transaction Financial Advisor” for all multiclass securities transactions. Participants will be working with their new multiclass securitization advisor starting in October. All multiclass transaction documents must be emailed to GinnieMaeREMIC@us.pwc.com. The primary transaction contacts are Jim Campbell, Deal Management Team Lead (NY), at James.Campbell@us.pwc.com, (646) 471-6059, and Amanda Liu, Deal Management Team Lead (DC), at Amanda.Liu@us.pwc.com, (202) 414-1392...

Expect a gradual but deliberate increase in Fannie Mae and Freddie Mac guarantee fees to a level that more closely reflects what a private market would charge, the head of the Federal Housing Finance Agency announced this week. In a speech at the American Mortgage Conference in Raleigh, NC, FHFA Acting Director Edward DeMarco said that since Fannie and Freddie were placed into government conservatorship three years ago this month, the two government-sponsored enterprises have steadily increased g-fees and lessened the degree of cross subsidization in credit pricing. Yet, DeMarco noted, the GSEs’ current pricing for credit guarantees “is...

The outstanding supply of home-equity loans in the market declined further in the second quarter of 2011, hitting its lowest level in almost six years, but there are signs that the HEL market is at least stabilizing. The Federal Reserve reported a balance of $904.4 billion of home-equity lines of credit and closed-end second mortgages outstanding as of the end of June, down 2.3 percent from the first quarter and 9.2 percent lower than a year ago. The vast majority of the HEL market is on the books of banks, thrifts and credit unions, which collectively held $827.7 billion in portfolio. Finance companies, some of them owned by... [Includes two data]

Industry groups are ramping up efforts to extend conforming loan limits currently available in high-cost markets that are set to expire at the end of the month, focusing their lobbying efforts on appropriations legislation in the House. The National Association of Realtors and the National Association of Home Builders are dou-bling their efforts to persuade Congress to extend current limits for Fannie Mae, Freddie Mac and the FHA, which top out at $729,750 for single-family units in the lower 48. Barring legislative action, the top loan limit will drop to $625,500 on Oct. 1. In addition to the lower ceiling, loan limits in most high-cost markets will...