Given the fact that rates have moved noticeably higher since the election, it’s widely anticipated that more originators will move to trim staff before yearend if they haven’t already.
The FHA this week announced higher “floor” and “ceiling” loan limits for forward and reverse mortgages for 2017, pushing loan limits upward in certain metropolitan statistical areas by as much as $162,500. The loan-limit changes will take effect on Jan. 1, spurred by rising median home prices. The Case-Shiller Home Price Index for September reported that home prices increased 5.5 percent year-over-year, driven by a tight supply of homes for sale, especially in the West. Each year, FHA recalculates its loan limits based on 115 percent of the median house price in the area. For counties located in MSAs, the loan limit is calculated based on the highest-cost county within the MSA. Under the 2017 changes, FHA will raise its nationwide “floor,” or low-cost area mortgage limits, for one-unit properties to $275,665 from $271,050, a difference of $4,615. In high-cost areas, the loan-limit ceiling for a ... [ 2 charts ]
The Consumer Financial Protection Bureau has ditched the antiquated method for assessing servicer compliance with reverse mortgage-servicing rules in favor of new examination procedures. Depending on the scope, each reverse mortgage-servicing exam will include one or more of eight modules covering various facets of reverse mortgage servicing. There are two kinds of reverse mortgages. The FHA, under the Home Equity Conversion Mortgage program, insures most reverse mortgages. As with other FHA mortgage products, it has a maximum loan amount. Some lenders also offer proprietary (non-HECM) reverse mortgages, which are designed generally for borrowers with higher home values and more equity, the CFPB noted. Proprietary reverse mortgages are not federally insured. However, companies that offer them copy the consumer protections found in the HECM program, including ...
Stakeholders voiced support for an FHA proposal to revive the agency’s single-unit approval policy for condominium financing but differed on owner-occupancy requirements. Both items are part of a proposed rule which would give the FHA more wiggle room in formulating its condo rules. The proposed rule’s 60-day comment period ended on Nov. 28. Among other things, the FHA is proposing to reinstate “spot approval” financing on individual units in condo projects that are not currently approved for FHA insurance. The Department of Housing and Urban Development terminated single-unit approvals a few years ago in favor of mandatory condo-project approval. Ultimately, the current approval process proved to be more cumbersome, resulting in many condo projects opting out of FHA. Under the proposed rule, single-unit approvals are limited to a maximum of 20 percent of the units in the ...
The Department of Housing and Urban Development has expressed concern about the inspector general’s decision to withhold its opinion on the results of FY 2016 audits of HUD and Ginnie Mae. In its audit report, the HUD inspector general said it has issued a disclaimer of opinion on HUD’s fiscal years 2016 and 2015 (restated) consolidated financial statements because of the agency’s failure to deliver both statements and their accompanying notes in a timely manner. In addition, there were several unresolved audit matters from past audits that prevented the IG from completing an examination of HUD’s and Ginnie Mae’s accounts and rendering an opinion. These unresolved matters related to a number of things, including the Office of General Counsel’s refusal to sign a management representation letter, HUD’s improper use of budgetary accounting methods, and the $4.2 billion in ...
US Court Issues Injunction on DOL’s Overtime Pay Rule. A federal judge in Texas granted states’ motion to block the Department of Labor’s controversial overtime pay rule set to take effect on Dec. 1, 2016. In late breaking news, the Department of Justice said it will appeal the injunction. The decision handed down by Judge Amos Mazzant of the US District Court for the Eastern District of Texas would deprive approximately 4.2 million workers who stand to benefit from the rule. Twenty-one states, a coalition of business organizations and the Plano Chamber of Commerce challenged the rule in separate amici briefs, arguing they stand to lose money if the final rule takes effect. The final rule would require employers to pay a higher salary level for certain employees to be exempt from overtime. In addition, it would automatically update the minimum salary level every three years. In his decision, Mazzant determined that ...
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