Two FHA lenders lost their direct-endorsement approvals due to excessively high default and claim rates. The two can apply to have their DE authorization reinstated six months from the date of termination.
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.