|SunTrust Mortgage is not suspending its wholesale FHA programs — though a newsletter from one of its account executives suggests otherwise. The company is, however, adjusting it pricing and evaluating the mortgage brokers it does business with.“SunTrust Wholesale is pulling out of the market for FHA loan originations for the next 20-60 days,” the recent newsletter from an Atlanta-area account executive said. “Wholesale FHA loans with SunTrust are their highest delinquency factor in the company.”
The newsletter was obtained and published by The Mortgage Lender Implode-O-Meter.
But a spokesman has confirmed that the Atlanta-based company has no plans to suspend FHA originations from mortgage brokers.
“We have not ‘pulled out’ or ‘suspended’ lending in this channel,” Hugh Suhr said in a statement to MortgageDaily.com. “We continue to originate via wholesale FHA program.”
He called the terminology used by the account executive “unfortunate” but acknowledged that pricing has been fined-tuned.
The account executive went on in the newsletter to say that SunTrust “will still offer FHA wholesale but are pricing themselves out of the market.”
He explained that the company has had a “phenomenal couple of months” and needs to evaluate the cost of hedging locks and brokers’ pull-through ratios. It is also analyzing delinquency by broker.
“The brokers that have good pull through will have no issues, the ones that do not will have an issue,” the newsletter stated. “SunTrust has let go a huge percentage of their brokers.”
The SunTrust spokesman confirmed that the company is “always evaluating the companies we do business with and are focused on originating quality mortgages.”
Last week, Wells Fargo & Co. and Taylor, Bean & Whitaker Mortgage Corp. disclosed increased minimum credit scores for third-party government originations. Taylor Bean Chairman Lee B. Farkas told MortgageDaily.com, “The tightening is due to increasing delinquencies in our GNMA portfolio.”