Freedom Mortgage, a key originator of FHA and VA loans, recently had its debt downgraded. Of course, it’s hardly alone on that score.

The rapid rise in refinance lending in the second half of 2019 boosted consumer-direct activity for FHA/VA lenders, though the correspondent channel remained the largest source of new business. (Includes data chart.)

Home Equity Conversion Mortgage endorsements dropped last year despite a strong fourth quarter. American Advisors Group retained its top position among HECM lenders. (Includes two data charts.)

VA originations set a new record in the fourth quarter despite a slump in purchase lending. Nonetheless, purchase mortgages accounted for a large share of total VA business in 2019.

Community mortgage lenders are asking FHA to drop its life-of-loan premium policy that requires borrowers to pay annual mortgage insurance premium until their loan is fully paid.

The bank is considering reentering the FHA market, which it fled in 2014 due to tougher regulations and onerous monetary penalties for violating lending rules. The exit of large banks allowed nonbanks to establish a foothold and the correspondent market to flourish in the FHA space.

FHA reforms suggested by the MBA include streamlining of servicing requirements and standardization of guidelines for downpayment assistance programs.

The revised defect taxonomy will hardly nudge banks to return to or increase participation in FHA programs despite tighter standards for identifying and curing defective loans, according to industry stakeholders.

In 2020, FHA is poised to take a significant chunk of high-risk business as Fannie and Freddie continue to draw back from the over-95% LTV market. VA is expected to continue its slow-growth trajectory.

Based on FHFA’s new 2020 loan limits, VA announced guidance for deter-mining the guarantee on loans to veterans with partial entitlement while Ginnie revised its definition of “high balance” loans.