Total FHA and VA originations increased during the first nine months of 2016 compared to the same period last year, although VA was more active, posting a double-digit production increase, according to an analysis of Ginnie Mae data. Lenders delivered $201.0 billion of FHA loans to Ginnie single-family mortgage pools over the last three quarters, up 4.8 percent from the previous year. Approximately 65.4 percent and 29.3 percent of FHA loans securitized were purchase loans and refinances, respectively. The remainder was loan modifications. VA originations totaled $143.2 billion over the same period, up 22.3 percent from last year. Refinances accounted for 51.9 percent of volume and purchase loans comprised 47.0 percent. The share of FHA loans in agency mortgage-backed securities for the nine-month period was 19.5 percent and 13.9 percent for VA. FHA loans accounted for ...

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 ...

In its petition to the U.S. Court of Appeals for the DC Circuit that is surprisingly brief, given what’s at stake in its dispute with PHH Corp., the CFPB seems to have abandoned its position that statutes of limitations do not apply to its administrative enforcement proceedings, legal observers suggest. This could provide a significant amount of legal certainty to lenders, if in fact it proves to be the end of the matter. In a client note reviewing the agency’s petition, attorneys with the BuckleySandler law firm in Washington, DC, pointed out, “Perhaps most significantly, the bureau’s petition does not request rehearing of the panel’s conclusion that RESPA’s three-year statute of limitations applied to administrative as well as judicial actions ...

Roughly 14 percent of the 12,500 mortgage complaints the CFPB has received to date from U.S. military personnel, veterans and their dependents involve problems with refinancing, and the issues they face have been changing over time, according to a new report from the bureau. “As the housing market has rebounded, we hear less about veterans struggling to refinance their loans when facing a financial hardship or imminent default and more about the problems associated with refinancing when they are using it as a tool to get potentially more favorable loan terms,” the CFPB document stated. The agency then delved into some of the specific gripes being lodged against mortgage companies. “We receive many complaints from veterans who believe they are ...

A strong purchase market helped push FHA and VA originations in the third quarter of 2016, according to an Inside FHA/VA Lending analysis of agency data. FHA forward originations increased by 17.4 percent from the second quarter for a total of $72.3 billion. That brought total FHA-insured loans originated over the first nine months to $187.3 billion, up 3.9 percent from the same period last year. Purchase mortgages comprised 70.0 percent of FHA’s total origination over the last three quarters. Quicken Loans reported only a 3.3 percent increase in FHA originations in the third quarter but still managed to retain its top ranking with $10.8 billion in FHA originations in the first nine months of 2016. Freedom Mortgage worked extra hard, ending the nine-month period with $5.0 billion on the strength of refinances. Third-quarter originations were up 69.6 percent from the prior quarter, and up 51.4 percent for the ... [3 charts]

The Department of Justice lost its bid to have an FHA lawsuit against Quicken Loans heard in the nation’s capital after a federal judge this week ordered the case transferred to federal district court in Michigan. Judge Reggie Walton of the U.S. District Court for the District of Columbia agreed with Quicken that the proper forum for adjudicating the government’s False Claims Act case is the Eastern District Court in downtown Detroit. While the court agreed that the case has national implications, it also noted the “strong local interest in this matter in the Eastern District of Michigan,” where “Quicken Loans underwrote the FHA loans at issue, endorsed those loans, and certified its compliance as to those loans.” While certain factors weighed against the transfer, the alleged unlawful activity occurred in or near Detroit, where the lender is headquartered and most of its employees are located. The case, U.S. v. Quicken Loans, ...

Aggressive refinance solicitation can be a double-edged sword for lenders: It could either result in increased VA refi business or, as the Consumer Financial Protection Bureau found out, consumer complaints. Since the CFPB began taking mortgage-related complaints in 2012, it has received more than 12,500 complaints from servicemembers, veterans, and their families. Of those complaints, 1,800 were related to VA refinancing. The VA offers two types of refinancing options to eligible borrowers – the VA cash-out refinance and the VA streamline refi, or Interest Rate Reduction Refinance Loan (IRRRL). In a cash-out refi, the veteran homeowner can refinance a VA or non-VA loan into a lower-rate VA loan and take cash out of home equity to pay off a debt, finance an educational pursuit or pay for a home improvement. The VA will guaranty up to the full value of the home. On the other hand, an IRRRL can only refinance a ...