FHA to Host First Briefing Session on the First Installment of the Single Family Policy Handbook. The FHA will have a webinar on Nov. 6, 2014, from 2 p.m.-3 p.m., for stakeholders in connection with the first completed section of the Single Family Housing Policy Handbook, the Origination through Post-Closing/Endorsement for Title II Forward Mortgages (Origination through Post-Closing). The new handbook is designed to make it easier for stakeholders to do business with the FHA and support greater access to mortgage credit for qualified borrowers. Once fully completed, the handbook will contain all FHA origination and underwriting policies that lenders use in making FHA-insured loans. The FHA published the first section of the handbook on Sept. 30, which becomes effective for FHA case numbers assigned on or after June 15, 2015. The agency urged lenders to ...
A proposed Federal Housing Finance Agency rule would define a Federal Home Loan Bank “former member” as an institution whose membership has been terminated but which must still maintain FHLBank stock. Published in the Oct. 8 Federal Register, the proposal’s definition would apply to institutions whose membership has ended but which continue to hold stock in the FHLBank as required by the Bank’s capital plan. …
The 12 Federal Home Loan Banks contributed some $300 million to affordable housing in 2013, according to a report by the Federal Housing Finance Agency. The report, issued last week, is part of the FHFA’s mandate to monitor and report annually on the FHLBanks’ support of their low-income housing and community development activities. In 2013, the Banks contributed approximately $297 million to the Affordable Housing Program, equal to 10 percent of their net earnings for the preceding year and up approximately 57 percent from 2012, noted the FHFA.
Most mortgage industry experts had expected loan origination volume to drop off significantly in the third quarter of 2014, but early indicators suggest just the opposite. An Inside Mortgage Trends analysis of earnings reports from seven large banks with major mortgage operations shows their combined loan originations increased by 8.7 percent from the second quarter. Together, the group racked up $97.4 billion in mortgage originations during the third quarter ...
When two mortgage companies combine forces, the merged operation may have to deal with redundancies in operations, fulfillment, human resources and other areas that result in staff cuts. However, loan officers can see opportunity if the companies are combining to reach new markets. Not all LOs stay. In fact, once word leaks out that a company is a takeover target, many LOs start weighing their options, contacting competitors and sales managers who tried to ...
Missing or incorrect files was the most common defect found in 49 percent of the loans, of which 29 percent were deemed initially unacceptable. Flawed credit or underwriting came in second at 26 percent, of which 67 percent were rated unacceptable. Program eligibility and operational deficiencies each had a 9 percent share while defective appraisals were common in 7 percent of all reviewed loans. Properly mitigated, the percentage of initially unacceptable loans usually drops to about 7 percent. The FHA tends to blames lenders for the defects but the bottom line is mistakes cut both ways, according to compliance experts. “Lenders make mistakes that can easily be corrected,” said one compliance consultant. “FHA also can be guilty of causing a mistake.” For example, poor communication and lack of clarity caused lenders to check a yes/no box to confirm whether or not they ...
The Department of Housing and Urban Development’s Office of the Inspector General has announced a total of $581.8 million in recoveries in September to strengthen and stabilize the ailing Mutual Mortgage Insurance Fund. The recovered amounts are part of larger settlements between the federal government, U.S. Bank and Bank of America to resolve allegations of false claims and mortgage fraud in relation to FHA-insured mortgages. Both banks were investigated separately by the HUD-OIG, Department of Justice and U.S. attorneys’ offices in Michigan, Ohio and New York in connection with their lending and underwriting practices and quality-control programs for FHA-insured loans. On June 30, U.S. Bank entered into a settlement agreement to pay $200 million, of which nearly $144.2 million went to the MMI Fund. The bank admitted to poor underwriting, flawed quality control and ...
The Department of Housing and Urban Development’s Inspector General has recommended that HUD require an approved FHA lender to reimburse the FHA $1.6 million for improper claims on 11 preforeclosure sales, including lender and borrower incentives. An IG audit of EverBank of Jacksonville, FL, attributed FHA’s losses to the bank’s failure to determine whether or not defaulted borrowers qualified for the agency’s preforeclosure sale program. The IG looked into the bank’s short sale activities because it had the highest preforeclosure sale claims in Florida. More than 50 percent of EverBank’s FHA claims were from short sales, with more than $12.9 million paid from 2011 through 2013, the audit found. In response, EverBank questioned the accuracy of the IG report. The bank maintained that certain allegations do not constitute violations of ...
FHA reverse mortgage volume fell in the second quarter as well as during the first six months of 2014 as regulatory changes reduced profitability and increased the cost of originating the government-backed product, according to Inside FHA Lending’s analysis of agency data. Home equity conversion mortgage volume declined 19.9 percent quarter-over-quarter and dropped 9.0 percent during the first half of the year compared to the same period last year. HECM lenders reported $7.2 billion in total originations in the first half, with purchase loans accounting for 93.6 percent. Fixed-rate HECMs comprised only 22.2 percent of total volume as most borrowers turned to adjustable-rate HECMs for their reverse-mortgage needs. The top five HECM lenders – American Advisors Group, Reverse Mortgage Solutions, One Reverse Mortgage, Liberty Home Equity Solutions and Proficio Mortgage Ventures – accounted for ... [1 chart ]
Like all new automated systems, FHA’s Lender Electronic Assessment Portal (LEAP 3.0) was not without technical glitches when the agency rolled it out back in May. Users immediately reported difficulties in certain functions, such as adding new branches, making changes to existing branches and changing cash flow accounts. The FHA ever since has been working to iron out the kinks to allow lenders to submit their annual recertification packages with ease. So far, certain fixes have been implemented allowing lenders to add, edit and delete branch and regional managers, delete attachments uploaded to LEAP and properly update cash flow accounts in the database. The FHA also changed the way lenders edit their principal affiliations in LEAP. In addition, newly approved lenders now have access to the new system. Furthermore, the FHA expanded to 250 the maximum allowable characters lenders may use when ...
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