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.

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.



HUD Makes FHA Proposals

Secretary sends letter to congress

February 11, 2008

By MortgageDaily.com staff


The Secretary of the U.S. Department of Housing and Urban Development warned that without higher premiums for higher risk borrowers, the Federal Housing Administration could be driven into insolvency in the current mortgage market environment. He opposes less stringent requirements proposed for mortgage brokers to originate government-insured loans and wants to do away with down payment assistance programs funded by sellers.

HUD Secretary Alphonso Jackson wrote about his concerns in a letter to Rep. Barney Frank, chairman of the House committee on financial services, and Sen. Christopher Dodd, chairman of the Senate committee on banking, housing and urban affairs today. He called on both houses of Congress to reach agreement on H.R. 1852, the Expanding American Homeownership Act of 2007, and S. 2338, the FHA Modernization Act of 2007.

"Efforts to modernize the FHA are particularly pressing during this period of volatility in the real estate markets and contraction in the mortgage markets," Jackson wrote. "This becomes more critical as the housing market continues to decline."

The secretary said FHA does not support provisions of the existing bills that would limit the agency's ability to give lower premiums to borrowers with better credit histories, which would benefit a significant number of low income borrowers, or impose a 12-month moratorium on HUD's proposed modifications to the current premium structure.

"Especially in the current economic environment, when market-rate loans are increasingly difficult to obtain, FHA needs to manage its insurance funds in a manner that is safe and sound and that guarantees its financial solvency in the future," he said. "Unfortunately, the self-sustaining nature of the FHA insurance fund has been severely threatened in recent years by a shift in the overall composition of the FHA borrower pool."

Jackson explained the agency has been handling more higher risk borrowers -- especially those with little invested in the home because of seller funded down payment assistance programs. He said FHA heading toward financial insolvency in today's volatile market under the current premium structure.

He also called for an end to seller funded DPA's, which he said push default rates higher.

"HUD strongly urges Congress to prohibit seller-funded downpayment assistance in any final legislation on FHA reform," Jackson stated.

He estimated that continuing with DPAs in addition to prohibiting risk-based premiums would cost taxpayers $1.4 billion to subsidize FHA. He suggested cash down payments could be lowered to 1.5 percent to offset the loss of DPAs.

Jackson supports an increase in the FHA limit, currently $362,790, to the conforming loan limit, currently $417,000. But he opposes permanent higher limits for either FHA, Fannie Mae or Freddie Mac -- though he acknowledged the temporary increases in the economic stimulus package.

The secretary does, however, support an increase to the number of Home Equity Conversion Mortgages FHA can insure as well as allowing reverse mortgage on condominiums and purchase transactions, though he does oppose a proposed 1.5 percent cap on reverse origination fees.

Jackson does not want to see lenders or mortgage brokers with inadequate capital participate as correspondent lenders, as proposed in current legislation. The surety bond proposed in the bill would not provide any independent evaluation of financial stability, internal control systems, or compliance with FHA requirements.

Political Mortgage News | Mortgage Laws
Mortgage people in politics. Political contributions by mortgage companies. Coverage of political support by lenders and executives. GSE lobbying and issues.



Mortgage Broker News | Originator Newsletter
Stories about mortgage brokering and broker programs. Profiles of successful mortgage brokers. Articles about mortgage brokers who excel at other activities. Broker lawsuits and criminal broker activity.



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