twitter linkedin
facebook google+

Mortgage News

News by Subject
Complete list of specialty news sections.

Purchase Subscription
Subscribe to 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

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

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

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

Press Releases
Reports and announcements from

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.

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

Mortgage News


Mortgage News

HOT Topics









site map
Reverse Mortgage News
Home equity conversion mortgages, HECM lenders and HECM reports. Reverse mortgage lending issues, analysis and compliance.
Reverse Lender Facing Loss of FHA Approval

HUD proposing withdrawal of Financial Mortgage's approval

Oct. 30, 2009

By staff

A reverse mortgage lender in Hawaii faces the loss of its Federal Housing Administration approval over allegations it failed to meet FHA quality control requirements, didn't provide reverse mortgage prospects with adequate disclosures and confused borrowers by promoting annuities alongside its reverse programs. It's at least the third time the company has faced regulatory actions.

In a news release today, the U.S. Department of Housing and Urban Development said its Mortgagee Review Board is proposing to permanently withdraw HUD and FHA approval for Financial Mortgage USA Inc. In addition, the housing agency said it plans to slap the company with a $97,500 civil money penalty.

Financial Mortgage originates home-equity conversion mortgages.

HUD said that a complaint will be served against the Honolulu, Hawaii-based company, and it will have 15 days to request a hearing on the penalties.

The housing agency cited Financial Mortgage's failure to implement an independent quality-control plan. Instead, it reportedly relied on an internal executive to conduct quality-control reviews.

The lender also failed to adequately separate itself from an affiliated life insurance company, Estate Planners of America -- a situation that "confused elderly borrowers who could not tell with whom they were doing business," according to the announcement.

"Financial Mortgage USA and its affiliate, Estate Planners of America, then duped the borrowers into purchasing annuities from Estate Planners of America, which borrowers did not request and did not understand had been purchased," HUD said.

HUD cited the case of an 88-year-old borrower who was steered into purchasing an annuity that doesn't mature until she is 104 years old.

In addition, HUD claims that Financial Mortgage failed to discuss options for receiving HECM proceeds or just ignored the borrowers' preferences. It also did not provide borrowers with a list of HUD-approved housing counseling agencies in the state where they lived.

Financial Mortgage has 30 days to respond to the proposed withdrawal of its approval and seek a hearing before an administrative law judge, the statement said.

FHA Commissioner David Stevens warned in the announcement that "approved lenders must understand that we mean business."

Similar rhetoric was used by HUD when it announced in early August that it had suspended the FHA approval of Taylor, Bean and Whitaker Mortgage Corp. and when it announced last week a lawsuit against Lend America seeking to suspend the Melville, N.Y.-based lenders FHA approval.

Financial Mortgage lost its residential mortgage license in California on Nov. 5, 2008, according to an order issued by the state's Department of Corporations. That order was the result of a lapsed surety bond and the lender's failure to file annual reports required by California.

In 2006, Financial Mortgage settled with Hawaii's Department of Commerce and Consumer Affairs over allegations it used unlicensed originators.

next story

back to current headlines

Financial Regulation News | Mortgage Regulations
Bank and mortgage regulators, regulations and regulatory actions. Coverage of regulatory legislation and testimony.

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


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