Ginnie Mae is redefining the term “defective mortgage” to remind issuers of their obligations when confronted by a mortgage that does not have federal insurance or guarantee. The action also clarifies options issuers may consider in dealing with defective mortgages. Under their guarantee agreement with Ginnie, issuers are required to cure, buy out or replace single-family mortgages or manufactured home loans that are missing the requisite FHA insurance or VA or U.S. Department of Agriculture guarantee within 120 days after the issue date of the mortgage-backed securities. Ginnie made clear that mortgages that do not have federal insurance or guarantee by the deadline for final certification of the related pool or loan package are defective. In addition, mortgages that have been rejected by FHA, VA or USDA, or for which federal insurance or guarantee have been withdrawn, are defective as ...

FHA Announces Revised Method for Calculating Initial MIP for HECM Refis. FHA has modified the formula for calculating the initial mortgage insurance premium for Home Equity Conversion Mortgage refinances with case numbers assigned on or after Sept. 19, 2017. The formula was modified on Nov. 14, 2017. The change conforms to the final rule FHA implemented last year to strengthen the HECM program. The revised formula has been posted on FHA’s HECM page on hud.gov, FHA Connection Release Notes, dated Dec. 28, 2017. The FHAC Release Notes outline the changes and processing instructions for lenders to calculate the initial MIP for HECM refis. HUD Releases Guide to Help Borrowers and Disaster Victims Avoid Foreclosure. The Department of Housing and Urban Development has released the Homeowners Guide to Success to help struggling homeowners and ...

FHA saw many of the policies under the previous administration shelved during the first year of the Trump administration, including a proposal for a 25 basis point reduction in the annual mortgage in-surance premium, while waiting for a new commissioner to head the program.

The Government Accountability Office, in a new report, urged Congress to specify the economic conditions it believes the FHA mortgage insurance fund can withstand without supplemental funds.

The Department of Veterans Affairs has announced a new disaster-related loan modification option for servicers to use to help affected borrowers.

IberiaBank of Lafayette, LA, has agreed to pay $11.7 million to the federal government to resolve an alleged violation of the False Claims Act by submitting false certifications to obtain FHA in-surance on ineligible mortgages.

Ginnie Mae has issued expanded guidelines to protect veterans and investors from harmful loan churning and rapid prepayments in mortgage-backed securities. The changes, along with additional measures under consideration by a joint Ginnie Mae/VA refinance task force, are aimed at ensuring continued strength and liquidity of the Ginnie Mae MBS program, said Michael Bright, the agency’s acting president. The latest guidelines expand on an initial measure Ginnie implemented requiring six-months of seasoning of VA loans before they can be refinanced and delivered into Ginnie MBS pools. However, some lenders have found ways around the measure and have continued their questionable lending practices, said Bright during recent testimony before a House Financial Services subcommittee. Churning is both illegal and unethical because it preys on unsuspecting borrowers, who are pressured by ...

FHA this week announced a 6.8 percent increase in loan limits nationwide for 2018 with 26 counties seeing increases above the national rate. In high-cost areas, the loan-limit ceiling will rise to $679,650 from $636,150 in 2017, while the floor will increase to $294,515 from $275,665. In addition, the national mortgage limit for Home Equity Conversion Mortgages (HECMs) or reverse mortgages will rise to $679,650 from $636,150. FHA regulations do not allow HECM loan limits to vary by metropolitan statistical area or county. Instead, the single limit applies to all mortgages regardless of where the property is located, the agency explained. In between the floor and the ceiling is a broad band of loan limits for single-family forward mortgage loans set at 115 percent of median house prices. The forward limits vary according to MSA and county. The changes in the loan limits are the result of ... [ Chart ]

Congress on Thursday passed a stopgap-spending bill to prevent a potential government shutdown and to give lawmakers time to negotiate crucial issues. The House voted 235-193 to pass the measure. A short time later, the Senate quickly approved it 81-14. The temporary spending bill will keep the government running through Dec. 22. The continuing resolution or CR, that has kept the government open would have expired on Dec. 8. Both the House and Senate are scheduled to adjourn on Dec. 15. Congress will need to pass a final appropriations bill or another continuing resolution to keep the government operating after Dec. 22. Despite differences over tax reform, FY 2018 budget, immigration, health care and other issues, lawmakers do not want a shutdown, mortgage industry sources said. Republicans, in particular, hope to enact their $1.5 trillion tax package by Christmas. On the other hand, ...