The California Housing Finance Agency is planning to add VA loans to its list of mortgage programs, with an offer of downpayment assistance. Kenneth Giebel, CHFA director of homeownership, said the agency plans to have a VA loan program in place in early 2016 to complement other first-mortgage programs. In addition, the agency is considering adding the U.S. Department of Agriculture’s guaranteed single family home loan program to its current product menu. Currently, the CHFA is working with the California Department of Veterans Affairs (CalVet) in providing home loans to qualified veterans and servicemembers. There are 31 military installations located throughout California, home to nearly 2 million veterans. A CalVet VA loan utilizes a veterans’ or service member’s VA eligibility and provides 100 percent financing. The department also has a Fannie Mae 97 loan-to-value ratio product, which ...
The Department of Veterans Affairs and the FHA have issued guidelines concerning the Consumer Financial Protection Bureau’s TILA-RESPA Integrated Disclosure (TRID) rule as it relates to VA- and FHA-backed mortgages. The new TRID rule covers loan applications received on or after Oct. 3, 2015. It replaced Truth-in-Lending-Act disclosures and the Department of Housing and Urban Development’s closing (HUD-1) settlement statement. The rule requires that all covered loans be closed using the new closing disclosure. The VA has announced new closing-disclosure guidelines and a new mandatory method for the stacking order of loan files selected for full-loan review. According to the VA, all files selected for full review on or after Oct. 3 may include the HUD-1 statement. The agency is aware that loans will be requested that have the HUD-1 closing document, and that it will perform the full file review with the ...
A trade association representing large financial institutions has asked the FHA to clarify its policy regarding the use of downpayment assistance programs on home purchases financed with FHA mortgage loans. The differences in the interpretation of the Department of Housing and Urban Development’s inspector general and the FHA of downpayment assistance programs (DAP), especially by state housing finance agencies, has created uncertainty among lenders, according to the Consumer Mortgage Coalition. In a letter to HUD Secretary Julian Castro, the CMC expressed concern that lenders may become unwilling to continue offering loans with assisted financing because of legal uncertainty. “This would be unfortunate for moderate-income borrowers nationwide, and it would unnecessarily limit the ability of [state housing finance agencies] to function,” the group said. SHFAs do not rely on taxpayer funding for ...
Direct holders of liens against FHA-insured, single-family properties must submit bills for taxes and other fees to specific points-of-contact (POCs) to avoid unnecessary litigation to enforce a lien, according to a new FHA proposed rule. The proposed rule also provides a process for filing a lawsuit against the FHA if, for some reason, payment is not made to the lien holder. Published in two related Federal Register notices, the rule establishes POCs for lienholders, tax agencies and others for the management and disposition of HUD-acquired single-family properties. The POCs are authorized under the National Housing Act. The first notice (FR-5823-N-01) provides POCs within the Department of Housing and Urban Development for lien holders on FHA-owned properties to ensure they receive timely payment of taxes and liens on such properties and to avoid litigation for nonpayment. In addition, the ...
The FHA has extended the period during which servicers must identify delinquent Home Equity Conversion Mortgage loans that have become due and payable or against which an initial legal action has been taken because they are no longer curable. In April, the FHA issued guidance that granted mortgagees 180 days, or until Oct. 23, 2015, to review their portfolios and bring defaulted HECM loans into compliance with the mandatory foreclosure timelines. On Oct. 16, the agency extended the timelines through Jan. 18, 2016. The initial guidance laid out loss mitigation options that HECM servicers may provide when property charges are not paid in accordance with the terms of the HECM loan. HECM loans that are subject to a repayment plan may continue as long as they remain current, said the FHA. Otherwise, lender/servicers must follow the requirements in the April guidance. The loss mitigation options are not available ...
The Department of Veterans Affairs has issued guidance clarifying certain procedures when conveying a property to the agency in Florida. Overall, it is necessary to provide proper documentation when conveying a property to VA. This usually involves providing an owner’s title insurance policy with no exclusions, other than for taxes that have not been billed but may be accrued against the property. In 2008, Florida amended its condominium and planned unit development (PUDs) laws to allow homeowner associations (HOAs) to collect unpaid dues and assessments. The purpose of the legislative change was to make current owners jointly liable with the past owner for the full amount of past-due HOA dues and assessments, unless the HOA was named in the foreclosure complaint at the time it was filed. However, if the HOA is properly named in the foreclosure, a current owner’s limited liability could be less. In order to ...
Mortgage production ran into a seasonal buzz-kill and stiffer headwinds from interest rates during the third quarter of 2015, leading to a modest decline in volume, according to a new InsideMortgage Finance market analysis and ranking. An estimated $455.0 billion of single-family first-lien mortgages were originated during the third quarter, down 7.1 percent from the second quarter of 2015. But on a year-to-date basis, total originations were up 42.9 percent from the first nine months of last year. In fact, at $1.350 trillion, production through the end of September had already topped last year’s $1.300 trillion. A lot of this year’s increase came...[Includes two data tables]
Although most analysts and industry observers agree that the FHA cut in mortgage insurance premiums, effective in January, has resulted in stronger purchase volumes and credit availability, opinions vary as to whether another reduction is on the way. The FY 2014 independent actuarial audit of the FHA Mutual Mortgage Insurance Fund projected FHA’s total loan production in fiscal 2015 at $124 billion. With the FHA pricing adjustment, production is now expected to increase by 60 percent, with total production estimated at $200 billion by the end of the fiscal year, said Brian Chappelle, an industry consultant. As program fundamentals trend upward, Chappelle is...
First Mortgage Corp., Ontario, CA, this month completed its liquidation, selling its branch network and $6 billion of servicing rights to other firms, and winding down a 44-year-old business that catered to FHA borrowers with lower credit scores. Jean Ziroli-Kobielsky, a recruiter for the family-owned business, noted that it wasn’t fear of regulatory oversight that prompted her father and brother to sell FMC, it was technology: “Some of our technology systems were still using DOS,” she told Inside Mortgage Finance. (DOS, or disk operating system, was the precursor to the Microsoft Windows software line for PCs.) She said...
Many independent mortgage companies that are relatively new to the mortgage servicing market are actively managing their portfolios in a constantly shifting environment, according to panelists at the annual convention of the Mortgage Bankers Association. The surprisingly cheap cost of retaining mortgage servicing rights during the 2012 bonanza led a number of nonbank lenders to start amassing MSR portfolios. It has become a valuable tool in managing cash flow and earnings in the volatile mortgage production market of recent years. Guild Mortgage is...