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| Several Dallas-based companies were among mortgagees to lose their approval to originate loans insured by the Federal Housing Administration.
The U.S. Department of Housing and Urban Development announced today the termination of Origination Approval Agreements with eight companies. The move is part of the FHA Credit Watch Termination Initiative. HUD said it terminates agreements when loans originated by the mortgagees have a “default and claim rate for loans endorsed within the preceding 24 months that exceeds 200 percent of the default and claim rate within the geographic area served by a HUD field office, and also exceeds the national default and claim rate.” The companies with FHA terminations, which apply only to the branch listed and not all of the mortgagee’s branches, included AAA Worldwide Financial Co., Loanamerica Home Mortgage Inc. and Northwood Credit Inc. — all based in Dallas. In Indianapolis, Pinnacle Mortgage Funding LLC and Union Federal Bank Indianapolis lost their FHA approvals. Also on the termination list were First Alliance Mortgage Co. in Bingham Farms, Mich.; First Alternative Mortgage Corp. in Schenectady, N.Y.; and GSF Mortgage Corp. in Peoria, Ill., HUD reported. Any of the terminated mortgagees can reapply for a new origination agreement after six months if they still qualify and if the Secretary determines the underlying problems have been corrected, the announcement said. “A mortgagee applying for a new Origination Approval Agreement must obtain an independent review of the terminated office’s operations as well as its mortgage production, specifically including the FHA-insured mortgages cited in itstermination notice,” according to HUD. “The review must be conducted and issued by an independent Certified Public Accountant qualified to perform audits under Government Auditing Standards as provided by the General Accounting Office.“ |
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