The Federal Housing Administration (FHA) released a proposed rule last week that would change its lender certification requirements. Under the proposed changes, requirements would be more transparent, making it easier for depository institutions to offer these types of loans.
FHA loans, although not commonly used by credit unions, are a good option for many first-time homebuyers and an important part of the mortgage market.
“FHA’s goal is to produce forms that are concise, while appropriately reflecting FHA’s statutory and regulatory program requirements in a way that is easily understood by all parties. The proposed changes streamline the certification statements while continuing to hold lenders accountable for compliance with all HUD eligibility and approval requirements,” the agency stated.
Proposed revisions to the Addendum to Uniform Residential Loan Application would reorganize Form 92900-A, regarding loan-level certification, into a more understandable format. Eliminating duplicative information that is listed elsewhere on the form. Existing and proposed language can be viewed side-by-side here. The administration is also proposing changes to its annual lender certifications to better align them with National Housing Act standards.
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