|Financial institutions have a simpler option for becoming approved to originate FHA-insured loans. Once approved, a number of services aim to help lenders with various FHA refinance programs -- including one that several trade groups are lobbying Congress to extend.
While banks that seek to become direct FHA lenders must invest in substantial training and have a direct endorsement underwriter on staff, Bankers Advisory says the supervised correspondent option enables banks to quickly enter the FHA market with minimal expense.
"Community banks, thrift institutions, and credit unions seeking to serve mortgage customers with loans insured by the Federal Housing Administration can qualify for FHA approval with minimal capital investment," the Belmont, Mass.-based firm said in an announcement last week. "Supervised correspondents maintain control of all aspects of the client relationship without the necessity of hiring FHA-certified personnel."
Wolters Kluwer Financial Services said earlier this month that it is developing a number of services to help financial institutions comply with disclosures and closing package requirements on the Hope for Homeowners program. The documents are expected to be ready this month.
Wolters is also hosting a free roundtable Webinar on Jan. 7, 2009, about the differences between modifications and the H4H program, H4H eligibility and requirements, and operational considerations for implementing an H4H program.
Lend America's institutional investor channel for H4H refinances, which was launched on Oct. 17, has secured multiple institutions as customers, a recent press release said. Among the new customers are Wall Street banks and hedge funds.
The Melville, N.Y.-based lender said it helps customers quickly recapture principal from non-performing residential mortgage portfolios. Its current caseload is "thousands of borrowers" and the forecast is for significant growth through next year.
Lend America also solicits borrowers through a retail channel that is being promoted in an advertising campaign.
The National Association of Mortgage Processors reported Saturday that streamline FHA refinance applications are skyrocketing. The Washington, D.C.-based group is promoting a 3-hour Webinar about various streamlined options. The $99 Webinar will run on Dec. 17 and Dec. 29 and is capped at 100 participants.
Seven trade groups -- including the American Bankers Association, the Consumer Mortgage Coalition and the Mortgage Bankers Association -- jointly issued a letter to four senior Congressmen calling for the continuation of the FHASecure program beyond its Dec. 31 sunset date. The letter indicated that the H4H program is an inadequate alternative because investor approval is often difficult to obtain.
"FHASecure is a much more accommodating product, and is proving to be of great value in resolving homeowners' needs in a wide array of situations," the letter stated. "Keeping this program available is of extreme benefit to borrowers and lenders alike."
Fair Lawn, N.J.-based Columbia Bank announced last month that it was approved to originate FHA-insured loans. Columbia, which reports $4.5 billion in assets, says it is the third largest U.S. mutual banking institution.