The Department of Housing and Urban Development is conducting an in-depth review of mortgage lenders, including those that pose the highest risk, in anticipation of a drastic reduction in the number of FHA lenders because of recent FHA reform measures. Responding to a recent report by the HUD Office of the Inspector General on the FHA lender recertification process, HUD said its Lender Approval and Recertification Division has begun manual reviews of 200 FHA-approved lenders that could potentially spell trouble for the agency. The more detailed reviews are part of HUD’s implementation of a final lender-related rule issued in June last year. The rule increased...