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Inside FHA/VA Lending

June 11, 2010

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House Passes 2010 FHA Reform Bill

The House of Representatives this week overwhelmingly approved FHA reform legislation based largely on proposals from the Obama administration to tweak premium charges and bolster lender oversight. After a rancorous partisan debate on the House Rules Committee measure that set the terms for floor consideration of the FHA Reform Act of 2010, lawmakers moved swiftly through a series of 13 proposed amendments and voted to approve the revised bill by 406-to-4. The bill, H.R. 5702, would allow... Read More

FHA Share of Purchase Market Booms

The FHA program accounted for nearly as much purchase-money lending as Fannie Mae and Freddie Mac combined during the first quarter of 2010, according to a new Inside FHA Lending analysis. FHA’s home-purchase financing totaled $42.9 billion, a few billion short of the $46.4 billion financed by the two government-sponsored enterprises. Purchase-money mortgages accounted for 61.1 percent of FHA originations in the first quarter, down slightly from... Read More

Changes to Programs Could Boost Refi Activity

The FHA is making changes to both its streamline refinance program and the new short refi program rolled out by the Obama administration. After spurting to a 50 percent share of FHA business in April 2009, refinance loans fell to just 30 percent of total FHA originations in April. Sources said a number of causes contributed to the dip. Given the growing number of... Read More

VA Lending Steady, Offering HAMP-Style Mod

Home loans guaranteed by the Department of Veterans Affairs are performing remarkably well, according to the latest industry data, and servicers may now modify VA loans using the same formula as in the Obama administration’s Home Affordable Modification Program. The Mortgage Bankers Association’s latest National Delinquency Survey shows that the serious delinquency rate for VA loans in the first quarter of 2010 was 5.29 percent, well below the 7.08 percent for prime loans. The VA delinquency rate in 1Q10 was down 13 basis points from the 5.42 percent at the end of 2009. “VA loans have performed better than any other segment of the market, despite... Read More

Rehab, Energy-Efficient FHA Loans Hold Value

Several lesser-used FHA loan products are increasingly presenting opportunities for both lenders and borrowers, including 203(k) rehabilitation loans and loans for energy-efficient improvements, experts said at a recent industry conference. Industry participants are even combining both products into one value-soaked loan. “We’re coming out of tough times, but now we’re in a strategic time, and the question is what the market will look like going forward,” said Robert Sahadi, managing principal at Green Space Investment. “Energy efficiency is... Read More

Florida, NY Hold Steady in FHA Originations

Only a few states saw their FHA lending hold steady in the first quarter of 2010. California kept its stranglehold on the FHA market with $10.99 billion in originations in 1Q10, a 4.5 percent decrease from the end of last year – but still more than 15 percent of the FHA market. Texas remained the second-largest FHA lending state with $4.02 billion, a 21.7 percent fall from 4Q09. Florida and New York, ranked third and fourth, respectively, decreased their FHA lending 4.9 percent and 6.5 percent, among the lowest rates of... [Includes two data charts] Read More

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