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One of the few areas with consistent growth recently has been the origination of loans insured by the Federal Housing Administration. As government and industry call for more FHA resources, lenders and service providers are capitalizing on the boom in FHA business.

First Federal Savings Bank turned to Wolters Kluwer Financial Services to help it become FHA approved, a recent news release said. Wolters said it helped the Evansville, Ind., bank obtain an FHA license and educate 14 employees onsite about FHA loan origination, processing, underwriting and servicing requirements.

“The complexity of the rules and regulations behind the FHA program can be extremely difficult for a lender without experience in this area to interpret,” First Federal executive Monica Stinchfield was quoted as saying.

In prepared remarks for the National Association of Real Estate Editors Annual Conference in Washington, D.C., last month, U.S. Department of Housing and Urban Development Secretary Shaun Donovan said the Obama administration is asking Congress for the authority to endorse up to $400 billion in authorization for FHA insurance. Donovan noted that the request was made “in light of the substantial increase volume we’ve seen in the last two years.”

Donovan reported that FHA market share has gone from less than 2 percent in 2006 to 24 percent today. He said FHA credit scores have increased to 692 from 626 a year ago.

“Given that our expectation that FHA loan volumes will continue to be high until the credit crisis passes, while we have requested expanded loan commitment authority for both FHA and Ginnie Mae, we will not be asking the American taxpayer to support FHA’s single family program in the FY 2010 budget,” the HUD chief stated.

A June 18 statement from the National Association of Realtors said rising FHA activity calls for increased support for FHA staffing and resources. The trade group called on the House Financial Services Subcommittee to consider provisions of S. 896, the Helping Families Save Their Homes Act of 2009, which was proposed in the U.S. Senate.

The recent confirmation of David H. Stevens as Federal Housing Commissioner was praised by the National Association of Home Builders. In a press release Monday, the group called Stevens “a strong and experienced leader.”

NAHB estimated last month that an addition 40,000 purchase transactions will occur as a result of FHA’s decision to allow state housing finance agencies to provide second mortgages that monetize the $8,000 tax credit. The move will enable borrowers to use the funds toward down payments and closing costs on FHA-insured loans. In all, NAHB projected 200,000 home sales from the tax credit.

Movation FHA SafeGuard automatically compares a lender’s FHA data with government data throughout the origination process, a June 24 press release. The offering prevents oversights and monitors government policies and submits loans for FHA insuring automatically upon funding.

“We were able to instantly identify which loans were being shopped by brokers, easily corrected any loans that required changes to their MIP calculation factors, and eliminated the risk of having negative [Credit Alert Interaction Voice Response System] results show up after initial checks,” one Movation customer was quoted as saying.

Motivity Solutions Inc. said it originally announced Movation at the Mortgage Bankers Association’s Government Housing and Loan Production Conference on June 12 and June 13 in Washington, D.C. A “tremendous” response from “top FHA lenders” at the conference led to multiple agreements.

Quicken Loans hopes to lure FHA prospects with the release of a new online tool that helps FHA borrowers determine if they are eligible for FHA Streamline refinances.

Last month, Gold Star Mortgage Financial Group touted that it was ranked by HUD as the No. 9 FHA lender in Southeast Michigan.

Mark Revetta, chief executive officer of San Diego mortgage broker SD County Financial, reported that his company has seen record originations despite that San Diego County has been one “the-top 10 hardest-hit counties in the nation.” Revetta attributed the growth to the combination of lower home prices and higher FHA limits.

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