David Saks: December 2013

David Saks - Real Estate Broker - The Real Estate Mart of Tennessee, Inc. - 4040 North Watkins-Suite #4 - Memphis, Tennessee 38127 - Phone (901) 357-4663

FHA UPDATES LENDING STANDARDS FOR MANUALLY UNDERWRITTEN BORROWERS

 

HUD NEWS

 

U.S. Department of Housing and Urban Development – Shaun Donovan, Secretary

Office of Public Affairs, Washington, DC 20410

 

HUD No. 13-185                                                                                              FOR RELEASE

 

(202)708-0685                                                                                                  December 11, 2013

 

http://www.hud.gov/news/index.cfm

 

 

 

FHA UPDATES LENDING STANDARDS FOR MANUALLY UNDERWRITTEN BORROWERS

 

 Agency specifies ‘compensating factors’ for loans requiring manual underwriting

 

 

 

WASHINGTON – Today, the Federal Housing Administration (FHA) published revised guidelines for lenders when they manually underwrite mortgage loan applications of borrowers applying for FHA-insured mortgages. This change will improve a lender’s ability to objectively consider a borrower’s risk and reduce additional credit requirements or ‘overlays’ that exceed FHA’s own lending standards.  Read FHA’s revised manual underwriting standards.

 

 

 

The new manual underwriting requirements announced today are intended to encourage lenders to use a defined set of objective standards and ‘compensating factors’ in order to make responsible, risk-based underwriting decisions.  In addition, FHA’s manual underwriting guidance addresses loan characteristics such as high debt-to-income ratios and a lack of financial reserves that can result in high rates of default and foreclosure. 

 

 

 

“We want to provide revised guidance for our lenders so that they are confident in offering affordable mortgage loans to responsible borrowers under a reasonable set of guiding principles,” said FHA Commissioner Carol Galante. “We hope to bring more certainty to the market by helping lenders apply a set of consistent underwriting standards.”

 

 

 

Currently, most FHA-insured loans are underwritten through automated underwriting systems that score applications using FHA’s TOTAL (Technology Open to Approved Lenders) Mortgage Scorecard.  The TOTAL Mortgage Scorecard evaluates borrowers based on credit scores and other loan factors.  When TOTAL delivers a Refer scoring recommendation or when borrowers were not scored because they do not have credit scores, lenders are required to manually underwrite the borrower. Specific policy revisions included in this regulation are reserve requirements for all manually underwritten borrowers, establishing maximum qualifying ratios based on credit score and compensating factors; and providing a revised list of acceptable compensating factors with objective documentation requirements for assessing these factors. 

 

 

 

            FHA will shortly publish a Mortgagee Letter that will provide additional operational information for lenders.

source: HUD

http://www.hud.gov/news/index.cfm

 




David Saks



Time&Temp Memphis

Legal Disclaimer
Please be advised that:

 The information and notices contained in this blog are intended to summarize recent developments and news. The posts are presented as general research and information. These posts are not intended, nor should be regarded, as legal advice. Some blog posts concern allegations made in civil lawsuits and in criminal indictments in United States Courts. All persons are presumed innocent until convicted of a crime and proven guilty. Readers who have particular questions or who believe that they need legal counsel should seek the advice of a qualified attorney. It is neither the editor's or author's intention to create a confidential relationship or any broker-client relationship via communication from this site at any time. Please consult with your state real estate board if questions & answers in the education section conflict with the laws of your region or if you need clarification regarding their applicability or how they may govern the services that you provide.

By entering this web site, you understand the following:
When you select a link to an outside Web site, you are subject to the privacy, copyright, security, and information quality policies of that Web site. David Saks:
1.DOES NOT control or guarantee the accuracy, legality, relevance, timeliness, or completeness of information contained on a linked Web site;
2.DOES NOT endorse linked Web sites, the views they express, or the products/services they offer unless linked web sites, the views they express, or the products/services they offer endorse or support David Saks in accordance with the standards of the Tennessee Real Estate Commission and the Federal Government's laws regarding commerce and the application, solicitation and transmission of internet-related concerns, commerce or social networking;
3.CANNOT authorize the use of copyrighted materials contained in linked Web sites;
4.IS NOT responsible for transmissions users receive from linked Web sites;
5. That DavidSaks.Com is biographical & real estate related. Some links within will leave this site.
6. http://activerain.com/profile/davidsaks is internet-compliant & abides by the rules & regulations of the Tennessee Real Estate Commission, Eve Maxwell, Executive Director.
7. Unless indicated otherwise, ActiveRain does offer listings, or IDX and is provided for licensed salespersons, brokers, buyers & sellers of real property as a community & professional service.
8. David Saks is a retired / licensed real estate broker in the State of Tennessee, license #290452, and an independent contractor.
9. Information is believed to be accurate, but not guaranteed, at any realty link or document connected to the World Wide Web & viewable by anyone connected to the internet who has a web browser.
10. Brokers, buyers, sellers, agents & anyone should independently verify any information prior to submitting any offer to purchase goods & services from any link.
11. Please Visit The American Real Estate Alliance or Memphis.8k.Com for additional information regarding property issues for real estate professionals and consumers.

 

Photos © & Licensed by Nova Development

All Content Protected © 
Before you even think about
committing a real estate crime
click this red button.
Real Estate Crimes

© All Rights Reserved.

 

 

 

 

"Information generated by the Department of Justice is in the public domain and may be reproduced, published or otherwise used without the Department’s permission. Citation to the Department of Justice as the source of the information is appreciated, as appropriate."

Department of Justice Legal Policies


 

  Real Estate Crimes

 

Click "HERE" For Today's Question

 

 

TheListen Now!

David Saks Show

Saturday Nite

9pm-12am Central

University of Memphis

WUMR

 

Support
America's Hobby

Click Elvis

Mr.Saks' participation in ActiveRain ended April 13, 2015.

His blog archives will remain online.

May God bless you.

Comment balloon 0 commentsDavid Saks • December 11 2013 11:22AM
FHA UPDATES LENDING STANDARDS FOR MANUALLY UNDERWRITTEN BORROWERS
share
HUD NEWS U. S. Department of Housing and Urban Development – Shaun Donovan, Secretary Office of Public Affairs, Washington, DC 20410 HUD No. 13-185 … more
Former Real Estate Investor Sentenced to Five Years in Prison
share
Former Real Estate Investor Sentenced to Five Years in Prison for Bank Fraud and Money Laundering U. S. Attorney’s Office December 09, 2013 Middle District of Florida (813) 274-6000 &… more
Man Pleads Guilty to His Role in Racially Motivated Cross Burning
share
Alabama Man Pleads Guilty to His Role in Racially Motivated Cross Burning U. S. Department of Justice December 09, 2013 Office of Public Affairs (202) 514-2007/TDD (202) 514-1888 &… more
Monday's Madness #4 "Zero to 200 in Six Seconds"
share
0 to 200 in 6 seconds Bob was in trouble. He forgot his wedding anniversary. His wife was mad as hell. She told him "Tomorrow morning, I expect to find a gift in the driveway that goes from 0 to 200 in 6 seconds AND IT BETTER… more
Monday's Madness #3 "A Really Bad Day"
share
A Really Bad Day There was this guy at a bar, just looking at his drink. He stays like that for half of an hour. Then, this big trouble-making truck driver steps next to him, takes the drink from the guy, and just drinks it all down. The poor… more
Monday's Madness #2 "Glad to Be Drunk"
share
Glad to be drunk A completely inebriated man was stumbling down the street with one foot on the curb and one foot in the gutter. A cop pulled up and said, "I've got to take you in, pal. You're obviously drunk. " Our wasted friend… more
Monday's Madness #1 "The Generous Lawyer"
share
The Generous Lawyer A local United Way office realized that the organization had never received a donation from the town's most successful lawyer. The person in charge of contributions called him to persuade him to contribute. "Our… more
Real Estate Practice : Lesson 2480
share
#2480 Appraisals are performed so that the seller and the broker can determine a fair sales price for the property. Is this true or false Take your time. the solution is posted below the wildlife photo. A. False &… more
Real Estate Practice : Lesson 2479
share
#2479 When a comparative market analysis is prepared it uses an approach much like the method used in the income approach to appraisal. Is this fact true or false Take your time. The solution is posted below the wildlife photo… more
Real Estate Practice : Lesson 2478
share
#2478 An appraisal is generally considerd to be based on value according to a specific calendar and time element imposed on the various factors involved in estimating value. Is this true or false Please take your time. The… more