Jumbo lenders do not expect the higher FHA loan limits to have any adverse impact on their GSE business. Anyone seeking a loan above $625,500 only has one choice, and that is FHA, but the real question is how much business the conventional market would lose to FHA, lenders said. In addition to the higher loan limit, the FHA insures loans of more than 80 percent loan-to-value ratio and requires a 3.5 percent downpayment. The GSEs require a 20 percent downpayment on their jumbos. On the other hand, the private market offers loans above the GSE limits but does not originate loans in excess of 80 percent LTV. “For people seeking under-80 LTV loans, it is unlikely that ... [Includes one data chart]

Whatever FHA relief the Department of Housing and Urban Development may offer as part of a pending settlement of foreclosure-related charges will not necessarily let mortgage servicers off the hook, said HUD Secretary Shaun Donovan.Donovan assured lawmakers during a House Financial Services Committee hearing this week that any offer of relief from any FHA liability in connection with ongoing robo-signing settlement talks would be “in exchange for significant penalties and help to homeowners who were wronged by bad servicing practices.” The HUD secretary neither confirmed nor denied the ...

A coalition of 34 industry trade and affordable housing groups, housing and community reinvestment advocates has endorsed the nomination of Carol Galante as the Department of Housing and Urban Development’s deputy assistant secretary for housing and FHA commissioner.In a recent letter to both the chair and ranking minority member of the Senate Committee on Banking, Housing and Urban Affairs, the coalition voiced its strong support for Galante, who is currently serving in both positions on an acting basis. The coalition cited Galante’s experience as well as her previous job as HUD assistant secretary for multifamily housing. Her backers also point to her 31-year experience in private real estate as president and chief executive of BRIDGE Housing, California’s largest nonprofit housing development corporation, and its affiliate companies. In particular, the coalition underscored ...

The Department of Housing and Urban Development has announced a 3 percent cap on the actual financial and closing costs it would pay on behalf of purchasers of HUD-owned single-family properties. The “gross purchase price” is the bid price, before the subtraction of the broker’s sales commission and financing and closing costs. Upon closing of a competitive bid sale of a HUD foreclosed property, the department allows the deduction of buyer financing and closing costs from the proceeds. While the total amount of HUD’s payment will be indicated on HUD Form 9548 (Sales Contract, Property Disposition Program), the actual amount credited by HUD will be ...

The Department of Housing and Urban Development has announced a sealed bid sale of uninsured, nonperforming residential mortgages, the first of three bid loan sales scheduled in FY 2012. The sealed bid sale offering, SFLS 2012-1, is scheduled for Dec. 7, 2011. It consists of unsubsidized, nonperforming single-family mortgage loans that will be sold without FHA insurance and with servicing released. A listing of the mortgage loans is included in the due diligence materials provided to qualified bidders. Prospective bidders should first check HUD’s guidelines for bidder ineligibility. HUD made the sale information package available ...

President Obama has signed legislation returning funding fees for VA loans to their pre-Nov. 18 levels. The fees specified in H.R. 674, the 3 Percent Withholding, Repeal and Job Creation Act of 2011, are valid through Sept. 30, 2016. Signed on Nov. 21, the bill ends industry confusion over the amount of fees lenders should charge borrowers since the Department of Veterans Affairs, in a case of bad timing, issued new regulations in September to lower the fees. This was before Congress announced its intention to introduce legislation that will extend the higher fees through 2016. Under updated guidance issued by ... [includes one chart]

The seasonally adjusted delinquency rates for single-family FHA and VA mortgage loans fell in the third quarter of 2011 as did those for all other first-lien residential mortgages covered by the Mortgage Bankers Association’s National Delinquency Survey. According to the survey, the third quarter saw a 45-basis point drop – from 8.44 percent to 7.99 percent – from the previous quarter in overall delinquencies on a seasonally adjusted basis. For FHA loans, the rate declined 53 bps to 12.09 percent from 12.62 percent, while VA’s rate fell 47 basis points to 6.58 percent from 7.05 percent. On a year-over-year basis, the seasonally adjusted delinquency rate decreased ...

The decision to restore “emergency” high-cost loan limits for the FHA, but not for Fannie Mae and Freddie Mac, will likely have a negligible impact on the government-sponsored enterprises, according to a new Inside Mortgage Finance analysis of agency jumbo mortgage activity. During the first nine months of 2011, single-family loans exceeding $625,500 – the top GSE loan amount for high-cost markets since Oct. 1 – accounted for an infinitesimal 1.5 percent of Freddie Mac’s total single-family securitization. Although the FHA can resume insuring...(Includes three data charts)

Private mortgage insurer PMI Group Inc. circled the wagons last week when it initiated voluntary Chapter 11 bankruptcy protection to “protect stakeholders” as state regulators move to appoint a receiver for the company’s mortgage insurance unit. Headquartered in Walnut Creek, CA, but incorporated in Arizona, the Nov. 23 move to file for bankruptcy protection came one day after a Maricopa County judge rejected PMI Group’s bid to overturn the Arizona Department of Insurance’s seizure of its main unit, PMI Mortgage Insurance Co., in October. As part of the process to...

The Office of the Comptroller of the Currency last week reported that 12 bank and thrift mortgage servicers are pressing ahead to comply with the foreclosure practices consent orders issued in April, but it will take all of next year to complete the necessary steps. “Work is well under way on the actions necessary to comply with the consent orders,” the OCC said in a report. “Efforts to correct deficiencies in foreclosure processes, management oversight and internal audit are furthest advanced.” To forward the process of identifying and providing remediation to...