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 ...

A new report from the Government Accountability Office urged the FHA and the Rural Housing Service to consider consolidating both their similar, often overlapping single-family home loan guarantee programs. Both FHA and RHS, an agency under the U.S. Department of Agriculture, help borrowers finance homes by providing guarantees on their single-family mortgage loans. The latest GAO report expands on the analysis in a 2012 report, which found overlaps in the loan products offered by the two agencies, borrower income levels, and geographic areas served by the FHA single-family mortgage insurance program and the RHS’ Single-Family Housing Loan Guarantee Program. The report compared single-family home purchase loans backed by FHA and RHS in fiscal years 2010-2014. Auditors found significant overlap and some differences in the borrowers the agencies serve. According to the ...

FHA and VA loan performance improved in the third quarter of 2016 as the delinquency rate on government-backed loans declined on a seasonally adjusted basis, according to the Mortgage Bankers Association’s latest mortgage delinquency survey. The FHA delinquency rate fell by 16 basis points to 8.30 percent, its lowest level since 4Q97, with all categories – 30-days, 60-days and 90 days + past due – reflecting the decline. Over the quarter, the delinquency rate of FHA loans with payments 30 days past due dropped 4 bps from the previous quarter. Insured loans that were 60 days behind on their payments saw a 6 bps drop in their delinquency rate, while that for seriously delinquent loans fell 9 bps during the period. FHA mortgages showed some declines in performance on a non-seasonally adjusted basis. Approximately 8.70 percent of outstanding FHA loans were past due as of the end of the third quarter, up 25 bps from the ...

The FHA is decreasing the owner-occupancy rate for approved condominium developments that meet certain requirements, the agency announced recently. Currently, the FHA requires a minimum of 50 percent of the units be occupied by owners. The agency, however, said it would allow a 35 percent owner-occupancy rate if the project meets certain conditions that would make it more financially stable and less of a liability to the Mutual Mortgage Insurance Fund. While having too few owner-occupants could financially weaken a condo project, requiring too many could make...

Most loan characteristics for FHA and VA mortgages securitized by Ginnie Mae during the third quarter were consistent with prior periods, though there was an uptick in average loan size. In the FHA space, the average loan amount rose 2.9 percent during the third quarter to $193,352. For VA loans pooled in third-quarter Ginnie mortgage-backed securities, the average rose 2.0 percent to $257,772. That is...[Includes three data tables]