In testimony before the House Financial Services Committee, Mortgage Bankers Association (MBA) President and CEO John A. Courson spoke about improving the Federal Housing Administration's (FHA) oversight of loan originators.
Courson commented that efforts to modernize the FHA were successful – resulting in a market share growth of 17% in 18 months – but he also cautioned that the agency must be "more vigilant than ever about who is allowed to originate FHA loans."
Providing insight into the MBA's FHA agenda, which the trade group is expected to unveil to Congress in the coming weeks, Courson said the FHA needs greater human and technological resources.
"Improvements to FHA's systems will allow it to more effectively manage its portfolio, thus increasing efficiencies and lowering operational costs," Courson testified. "Such an investment would yield savings far in excess of any initial cost.
The MBA supports implementing a bonding requirement for mortgage brokers to participate in FHA lending, a requirement that already applies to lenders, he said. Courson also touched on the subject of mortgage fraud, warning that a higher volume of FHA loans exposes the agency's insurance fund to higher levels of mortgage fraud.
Courson's full statement is available on the MBA's Web site, www.mortgagebankers.org.