Home Equity Conversion Mortgage endorsements dropped last year despite a strong fourth quarter. American Advisors Group retained its top position among HECM lenders. (Includes two data charts.)

FHA endorsements in the fourth quarter of 2019 were the highest in years. Most of the increase was in the refinancing business led by the lower interest rate environment.

President Trump confirmed industry rumors by announcing his intent to nominate Dana Wade as FHA commissioner and assistant secretary for housing.

The Justice Department sees no need to issue additional guidance on defective FHA loans. The agency believes the actions undertaken so far will encourage depository institutions’ participation in the FHA program.

Community mortgage lenders are asking FHA to drop its life-of-loan premium policy that requires borrowers to pay annual mortgage insurance premium until their loan is fully paid.

The bank is considering reentering the FHA market, which it fled in 2014 due to tougher regulations and onerous monetary penalties for violating lending rules. The exit of large banks allowed nonbanks to establish a foothold and the correspondent market to flourish in the FHA space.

The revised defect taxonomy will hardly nudge banks to return to or increase participation in FHA programs despite tighter standards for identifying and curing defective loans, according to industry stakeholders.

In 2020, FHA is poised to take a significant chunk of high-risk business as Fannie and Freddie continue to draw back from the over-95% LTV market. VA is expected to continue its slow-growth trajectory.