home subscribe advertise reprints e-mail help RSS about us LOG IN

Mortgage News

 

Mortgage News

HOT Topics

production

servicing

compliance

legal

fraud

secondary

jobs

appraisal

site map

www.loan-academy.com/
twitter linkedin
facebook google+
Search:

Mortgage News

News by Subject
Complete list of specialty news sections.

Purchase Subscription
Subscribe to MortgageDaily.com and get immediate access to all news, statistics and archives.

Mortgage Advertising
Reach mortgage executives, loan originators and other people tied to mortgage industry.

Consumer Mortgage News
Free mortgage news for prospective borrowers.

Mortgage Newsletter
Free e-mail newsletter with the latest headlines from MortgageDaily.com.

Mortgage News Reprints
Put entire MortgageDaily.com stories in your online or printed newsletter or publication.

Mortgage Feedget RSS code
Condensed MortgageDaily.com stories free on your Web site or for your RSS reader.

News Archives
Archive of MortgageDaily.com stories by month going back to 1999.

Press Releases
Reports and announcements from MortgageDaily.com.

Mortgage Statistics
Data and statistics for real estate finance.

Mortgage Directories
Directories of lenders, branch operators and mortgage service providers.

Mortgage Graphs
Directories of lenders, branch operators and mortgage service providers.

Downpayment Assistance News

FHA Takes Big Hit on DPA Loans

FHA commissioner reports $4.6 billion loss

June 9, 2008

By MortgageDaily.com staff


The Federal Housing Administration reported that it has taken a massive loss on loans tied to seller-funded downpayment assistance and warned these loans could put the agency out of business.

The agency booked an additional $4.6 billion in unanticipated long-term losses, FHA Commissioner Brian Montgomery said at the National Press Club today, according to a transcript of his prepared statement released by the U.S. Department of Housing and Urban Development.

Montgomery said this was primarily due to seller-funded loans, which account for one-third of loans in the agency's portfolio.

He warned that legislation to modernize FHA must address the risk associated with downpayment assistance paid for by the seller or any other party that stands to financially benefit from the transaction. He noted his concerns are shared by the Internal Revenue Service, the General Accounting Office and HUD's Inspector General.

"Data clearly demonstrates that FHA loans made to borrowers relying on seller-funded downpayment assistance go to foreclosure at three times the rate of loans made to borrowers who make their own downpayments," Montgomery stated. "Unless we take action to mitigate these losses, FHA will soon either have to shut down or rely on appropriations to operate."

He said FHA is about to reopen public comment on a rule addressing seller-paid downpayment assistance. The rule will be submitted to the Federal Register today.

He said the agency has prevented 300,000 foreclosures on FHA-insured loans during the past four years and that nearly 500,000 FHASecure loans are expected to be endorsed this year.

Since September 2007, FHA volume was $76.1 billion, including $30.3 billion from FHASecure. Currently, there are 4.8 million FHA-insured loans.

He noted the temporary increase in FHA loan limits from the economic stimulus package is expected to boost FHA volume by 100,000 by the end of this year and called for a more permanent solution for high-priced markets. He also called for preservation of risk-based premiums that were recently implemented.

Montgomery warned that while some are calling for FHA to pick up all the potentially delinquent 2 million subprime loans, the agency is not designed to become the federal lender of last resort or a mega-agency to subsidize bad loans.

FHA News | Government Resources | M o r t g a g e e Letters | FHA Statistics
FHA, VA and HECM mortgage news. HUD and G i n n i e news also. Originations, servicing and FHA approval.




SUBSCRIBERS: Edit Subscription | Subscription Help | or call 214.521.1300

Subscribe Contact Us Site Map

Copyright © 2017 Mortgage Daily, D a l l a s
Subsribers Only:

AMC directory

ARM indexes

mortgage company directory

mortgage regulations

net branch directory

p r i c i n g engine directory

wholesale lender directory

More Mortgage News Resources (full site map):

advertising news

appraisal news

bank news

biggest lenders

commercial mortgage news

corporate mortgage news

credit news

FHA news

financial regulation news

foreclosure news

GSE news

jumbo mortgage news

interest rates

loan modification news

loan originator survey

LOS Newsletter

MBS

mortgage associations

mortgage-backed securities

mortgage books

mortgage brokers

mortgage compliance

mortgage conferences

mortgage directories

mortgage education

mortgage employment

mortgage employment index

mortgage executives

mortgage fraud

mortgage fraud blog

mortgage fraud local news

Mortgage Fraud Index

Mortgage Graveyard

mortgage insurance news

mortgage lawsuits

mortgage leads

mortgage lender ranking

mortgage licenses

mortgage litigation

Mortgage Litigation Index

Mortgage Market Index

mortgage mergers

mortgage news

mortgage politics

mortgage press releases

mortgage production

mortgage public relations

mortgage rates

mortgage servicing

mortgage statistics

mortgage technology

mortgage video

mortgage Webinars

net branch

net branch directory

nonprime news

origination news

originator tools

real estate news

refinance news

reverse mortgage news

secondary marketing

social media

servicing news

subprime news

wholesale lenders