The number of VA loans with a deficiency fell in April from March but was up 71.7 percent from the same period a year ago, according to the VA Lender Report Card. The report card includes VA loan reviews and deficiencies by month from April 2014 through April 2015. VA loan originations over the one-year period totaled 563,967, the report showed. Of those loans, 303,149 were purchase loans, 162,447 were streamlined refinances, and 98,371 were cash-out refis. A total of 39,037 loans were reviewed by VA, which comprised about 7.0 percent of total volume. Altogether, 14,793 loans (37.9 percent) had deficiencies. The average deficiency response time was 28.1 days. Of the 1,726 loans the VA examined in April, 613 (35.5 percent) contained deficiencies, down from 1,234 loans (33.7 percent of 3,662 loans reviewed) that were found with flaws in March. The number of deficient loans found in ...

A VA mortgage servicer must immediately schedule an inspection and protect a property securing a VA loan if the property has been left vacant or abandoned by its owners. According to new guidelines issued by the VA, loan servicers must conduct an inspection immediately after becoming aware that the property’s physical condition may be in jeopardy. If local codes require more extensive protection than what VA requires, servicers should adhere to local requirements, the agency said. Failure to protect and preserve the collateral may result in a reduced guaranty claim if the servicer’s failure increased the VA’s liability on the loan. Unless the loan is undergoing loss mitigation, a property inspection is also required before the 60th day of delinquency or before starting foreclosure, whichever is earlier, the VA said. In addition, a property inspection will be required at least once a month after ...

The VA loan is a great option for veterans and servicemembers looking to purchase a new home. However, did you know it could also be paired with other home-financing programs to give the borrower a bigger bang for the buck? For instance, many real estate brokers and mortgage lenders are unaware that the VA loan can be used with certain products offered through state housing finance agencies to provide greater benefits to veterans and members of the military. The Colorado Housing and Finance Authority (CHFA) offers a tax credit program that allows VA borrowers to claim a percentage of the annual mortgage interest paid each year as a federal tax credit on their federal income tax returns. “It is not a tax deduction,” said Chad Patterson, a real estate agent with RE/MAX Traditions in Longmont, CO. “This can be a huge asset to the ...

The Department of Housing and Urban Development’s Inspector General has slammed Ginnie Mae for understating the severity of misstatements in prior year financials. In a memorandum, the HUD IG said Ginnie Mae’s inadequate disclosures in a restatement notification did not help users of financial statements understand the full impact of the material misstatements. The reporting errors were identified in an IG audit of Ginnie’s fiscal year 2014 financial statements. According to the IG, the misstatements in the 2014 audit were due to improper accounting for FHA’s reimbursable costs and the flawed accounting treatment and inadequate disclosure of borrowers’ mortgage escrow funds held in trust by Ginnie in its defaulted issuers’ portfolio. These errors may have affected Ginnie Mae’s prior year financial statements as far back as FY 2011, the IG concluded. In its audit report, the IG ...

A significant percentage of active Ginnie Mae issuers use subservicers in their operations, and agency officials estimate that 22 subservicers handle roughly a third, or $510 billion, of the program’s portfolio. The four top subservicers handle approximately 21 percent of Ginnie’s total portfolio or 65 percent of the subserviced portion. During the recent Ginnie Mae annual conference in Arlington, VA, representatives from Lakeview Loan Servicing, Pingora Asset Management and ...

Riding a wave of heavy purchase-mortgage activity, Ginnie Mae issuers produced a record $128.23 billion of single-family mortgage-backed securities during the third quarter of 2015, according to a new Inside FHA/VA Lending ranking and analysis. The third-quarter figure, which includes FHA home-equity conversion mortgage MBS, was up 6.5 percent from the second quarter of this year. The previous record was $125.68 billion, set back in the third quarter of 2009. Loan-level MBS data, which do not include HECMs and have truncated loan amounts, show hefty gains in purchase-mortgage activity that more than offset sharp declines in refinance business. The flow of FHA purchase mortgages jumped 37.7 percent from the second to the third quarter, and VA purchase mortgages were up 37.9 percent over the same period. Meanwhile, refinance volume fell ... [ 2 charts ]

Certain unidentified independent mortgage bankers are in talks with the Department of Housing and Urban Development over alleged False Claims Act violations, according to a top mortgage industry executive. Speaking recently on the Internet radio program “Lykken on Lending,” Dave Stevens, president of the Mortgage Bankers Association and a former FHA commissioner, said the lenders are quietly negotiating and have avoided media attention, so far. On air, Stevens said he and a “certain group of individuals had met with HUD Secretary Julian Castro” to discuss the FCA complaints. The MBA official said the use of the FCA – which allows for treble damages – represents an “extraordinary overreach” by the government that is threatening the overall FHA program. Stevens did not name the lenders are or say how many there are, but he did mention an ...

The Inspector General of the Department of Housing and Urban Development called for civil and administrative actions against loanDepot for allowing ineligible “gifts” on FHA-insured loans.Acting on a referral from HUD’s Quality Assurance Division, the IG focused on FHA loans originated by loanDepot that included downpayment assistance from the Golden State Finance Authority. A review of 75 loans endorsed from Oct. 1, 2013, to Jan. 31, 2015, determined that 62 loans involved gift funds that did not comply with FHA requirements. In addition, the privately held nonbank lender “inappropriately charged borrowers $25,700 in fees that were not customary or reasonable, as well as $46,510 in discount fees that did not represent the purpose of the fee,” the IG said. The IG blamed loanDepot’s overreliance on Golden State’s Platinum Downpayment Assistance Program as well as ...

The majority of higher-priced first-lien loans in 2014 were FHA-insured, according to the latest Home Mortgage Disclosure Act data. Approximately 45 percent of FHA-insured, first-lien purchase mortgages had annual percentage rates in excess of the reporting threshold, similar to the percentage in the latter half of 2013, the Federal Financial Institutions Examination Council noted. Higher-priced loans are those with APRs that exceed the average prime offer rate by at least 1.5 percentage points for first-lien loans and at least 3.5 percentage points for subordinate-lien loans. The data on the incidence of higher-priced lending show that about 8 percent of first-lien purchase loans originated in 2014 have APRs that exceed the loan-price reporting thresholds, up from about 5 percent in 2013, the FFIEC said. The higher APRs for FHA loans were due to a slight increase in ... [ 1 chart ]

VA loan servicers have until Nov. 1, 2015, to review and comment on the new VA Servicer Handbook and ensure compliance with the established policy and guidelines. The servicer handbook combines guidance issued via circulars and news flashes over the years. In addition, the agency has started hosting biweekly servicer calls to update VA servicers on policy changes and new developments, according to Andrew Trevayne, assistant director of loan management with the VA Home Loan Guaranty Program. VA-guaranteed loans are serviced through the VA Loan Electronic Reporting Interface (VALERI) system. The handbook also discusses roles and responsibilities for VA loan-administration staff and servicers. It does not change or supersede any regulation or law affecting the loan program. Servicers may submit comments on the updated handbook to ...