The FHA would have more flexibility to adjust its insurance premiums and greater latitude to require lender indemnification under legislation approved by the House Financial Services Committee this week. The committee passed H.R. 4264, the FHA Emergency Fiscal Solvency Act of 2012, by voice vote on March 27, sending the measure to the House floor for consideration later this year. The bill is slightly different from the initial draft the House Financial Services Subcommittee on Insurance, Housing and Community Opportunity passed on Feb. 7, according to the bills author, Rep. Judy Biggert, R-IL. Under the bill, approved lenders may ...
Perceived inaccuracies in public discussions about the FHAs health and the way the agency manages its business have prompted Acting FHA Commissioner Carol Galante to address the issues and answer critics. In a posting on the Department of Housing and Urban Developments official blog this week, Galante said the FHA is moving in the right direction and that the Mutual Mortgage Insurance Fund is in a much better shape than it was in 2009. Critics have raised concerns about FHAs solvency, citing the current level of capital reserves, which have fallen way below the ...
Despite the steps taken recently by the Department of Housing and Urban Development to shore up the FHA insurance fund, concerns remain as to whether such actions are enough to make up for FHAs losses and restore the agencys mandatory 2.0 percent capital reserve ratio in a timely manner, according to HUDs top internal auditor. Testifying before the House Committee on Appropriations this week, HUD Inspector General David Montoya warned further actions might be necessary to ensure the stability of the FHA Mutual Mortgage Insurance Fund and reduce its risks. For example, FHA now uses credit scores to ...
A Texas-based mortgage lender that recently lost its approval to originate and underwrite FHA loans sued in state court to compel the Department of Housing and Urban Development to withdraw an announcement of the enforcement action. AmericanHomeKey filed the complaint in Dallas County Court to force the withdrawal of a March 23 HUD press release announcing the immediate and permanent revocation of the lenders FHA authority to originate, underwrite and close new mortgages with FHA insurance. The lender said a premature announcement would ruin its relationship with investors and result in massive losses. The HUD Mortgagee Review Board announced ...
The Department of Housing and Urban Development has reminded mortgagees and servicers that it is illegal to use mortgage escrow funds for purposes other than those stated in federal regulation. In a recent FHA notice, HUD warned approved lenders and servicers against applying escrow funds to reduce the outstanding balance in the payoff amount of an existing loan. The department said it has not authorized the use of borrower money in escrow accounts for reasons other than making legitimate payments. Escrow funds are borrowers funds collected at ...
FHA loan production declined by 11.0 percent in February from the previous month but increased 1.2 percent from a year ago, according to Inside FHA Lendings analysis of FHA data. Approved lenders reported $15.2 billion in new FHA-insured loans in February, down from $17.1 billion the previous month but up from $15.0 billion in the same month last year. In-house originations accounted for the lions share of FHA originations, 78.2 percent, for the month, while purchase mortgages made up the bulk of FHA endorsements at 55.1 percent. An estimated 97.1 percent were ... [1 Chart]
The House Financial Services Committee this week approved by voice vote a bill that would provide flexibility to adjust FHA premiums and pursue lender indemnifications more aggressively. H.R. 4264, the FHA Emergency Fiscal Solvency Act of 2012, differed slightly from the controversial initial draft the House Financial Services Subcommittee on Insurance, Housing and Community Opportunity passed on Feb. 7, according to the bills author, Rep. Judy Biggert, R-IL. The modified bill, she said, includes the tools the administration needs to ensure the FHAs financial soundness and lower taxpayer liability. The...
The FHAs total capital resources fell slightly during the fourth quarter of 2011, even while the rate of serious delinquencies edged higher, according to a quarterly report released this week. The FHA Mutual Mortgage Insurance Fund had $33.3 billion in total capital resources as of the end of December, down from $33.7 billion at the end of September. While the report does not cover the programs capital ratio a minimum level of reserves set by Congress that the program has failed to reach over the past two fiscal years its likely that the FHA may have slipped further behind. The agency...
A $95 million settlement with the nations four largest mortgage servicers Bank of America, JP Morgan Chase, Wells Fargo and Citigroup was announced last week by U.S. Attorney Bill Nettles of the District of South Carolina, the largest False Claims Act settlement in the history of the state, according to Justice Department officials. The settlement is part of the $25 billion global resolution announced in February between major banks and state attorneys general to settle claims of abusive mortgage practices, including robo-signing of foreclosures...
Federal Housing Finance Agency.FHFA Office of Inspector General. FHFAs Supervision of Freddie Macs Controls over Mortgage Servicing Contractors Faulted. The Federal Housing Finance Agencys Office of Inspector General found some areas in which the Finance Agency could improve its supervision of Fannie Maes and Freddie Macs controls over its mortgage servicing contractors. FHFA has not clearly defined its role regarding oversight of servicers, sufficiently coordinated with other federal banking agencies about risks ...