The revised defect taxonomy will hardly nudge banks to return to or increase participation in FHA programs despite tighter standards for identifying and curing defective loans, according to industry stakeholders.

In 2020, FHA is poised to take a significant chunk of high-risk business as Fannie and Freddie continue to draw back from the over-95% LTV market. VA is expected to continue its slow-growth trajectory.

Based on FHFA’s new 2020 loan limits, VA announced guidance for deter-mining the guarantee on loans to veterans with partial entitlement while Ginnie revised its definition of “high balance” loans.