HUD Takes Actions Against More Than 120 FHA-Approved Lenders

Posted by Orb Staff on May 26, 2009 No Comments
Categories : Residential Mortgage

S. Department of Housing and Urban Development's (HUD) Mortgagee Review Board has announced [link=http://edocket.access.gpo.gov/2009/pdf/E9-9731.pdf][u]actions[/u][/link] against more than 120 lenders for violating Federal Housing Administration (FHA) requirements. Violations range from failure to conduct sufficient quality control, to failure to continue to meet FHA recertification requirements, to falsifying loan documents. Among the actions announced, 102 lenders had their FHA approval withdrawn, five lenders agreed to make indemnification payments to FHA totaling more than $500,000 and 24 lenders were accessed fines or administrative costs totaling more than $1.2 million. The actions come on the heels of the passage of the Helping Families Save Their Homes Act, which grants the FHA more authority to keep bad actors out of the FHA programs. The Obama administration's budget proposal for fiscal year 2010 seeks additional investments in the FHA to curb fraud and abuse, including enhanced investments in technology, staffing and training to enable FHA to cope with the rising volume of mortgage business, detect fraud and monitor the practices of lenders and appraisers. ‘At this time of uncertainty in the mortgage market, FHA needs to be especially vigilant in making sure that its approved lenders meet the highest standards of conduct,’ says HUD Secretary Shaun Donovan. "We expect, and more importantly, American home buyers deserve, that when they deal with an FHA-approved lender, they're dealing with a lender they can trust." SOUR

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