The government has made it easier for smaller branch operations to originate Federal Housing Administration-insured loans.
The first two of three changes expand approved lending areas to include groups of states, and reduce to 13 the number of branches lenders need to operate nationwide, the U.S. Department of Housing and Urban Development recently said in a mortgagee letter.
Currently, nationwide origination can be achieved with about 25 branches, as each of these registered branches is restricted to originating mortgages only on properties that are located within clusters of HUD field office jurisdictions, as opposed to all HUD field office jurisdictions within groups of states, according to the letter dated Oct. 20.
In some instances, if a lender desires to "originate in the 48 continental States and the District of Columbia, this number is further reduced to as few as 10," HUD said.
The third change allows lenders to operate nationwide "direct" lending via the Internet or a call center through one registered office. "Each mortgagee will be limited to only one branch ID number for its direct nationwide lending operation," the letter read.