Senior officials at the Federal Housing Administration today discussed a proposal to significantly change the agency’s loan-level and annual lender-level certifications to provide more precision and needed clarity to compliance documents for forward and reverse mortgage cases.
Specifically, FHA is proposing revisions to its Addendum to Uniform Residential Loan Application (Form 92900-A) and to its annual lender certification form. In addition, FHA is revising its ‘defect taxonomy’ to clarify the various loan defect categories and how the agency weighs the severity of each defect.
The proposed updates are now posted on the Single Family Housing Drafting Table (Drafting Table) on hud.gov. Stakeholders are encouraged to submit feedback no later than June 8, 2019.
Today’s announcement was couched as a response to a recent Presidential Memorandum which instructed HUD to find ways to get more depository institutions back into FHA lending. During a call with reporters, Acting Deputy HUD Secretary/FHA Commissioner Brian Montgomery referenced the lack of clarity and inability to manage unknown risks posed by the False Claims Act as a factor for why participation by depository institutions has plummeted from 44 percent of FHA originations in 2010 to 13 percent today.
As NRMLA learns more about these proposed changes, stay tuned for future updates.