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| Several lenders have had their origination approval agreements terminated by HUD, including a Jackson, Miss. branch of one of the country’s largest lenders.
According to a notice in the Federal Register dated September 15, poor performance of loans originated by a number of lenders led HUD — or the U.S. Department of Housing and Urban Development — to terminate their ability to participate in the Federal Housing Administration (FHA) mortgage insurance program. HUD says it can terminate participation in the FHA program if a mortgagee has a default and claim rate, for loans endorsed within the past two years, that exceeds the national rate and exceeds 200 percent of HUD’s local field office rate. This time around, HUD said it only terminated lenders that exceeded 250% of the field office rate. Among the terminated mortgagees was a Hattiesburg, Miss. branch of Countrywide Home Loans, Inc. Countrywide, which reported August fundings of $41 billion, did not immediately respond to MortgageDaily.com’s requests for a statement. Other lenders on HUD’s termination list include the following companies:
HUD said terminated lenders can apply for a new origination approval agreement after six months if the mortgagee still qualifies based on FHA lender requirements, and if the “Secretary determines that the underlying causes for termination have been remedied.” |
Sam Garcia has been in mortgage lending since 1980, and is publisher of MortgageDaily.com. He also owns and operates CloseNow.com, a real estate portal site.
email:Â SamGarcia@MortgageDaily.com
