The Federal Housing Administration (FHA) of the U.S. Department of Housing and Urban Development (HUD) recently issued Mortgagee Letter 2011-34 to announce revisions to FHA's requirements for obtaining, maintaining, and utilizing an entity's lender approval... All changes set forth in the Mortgagee Letter became effective immediately.
Following is a summary of Mortgagee Letter 2011-34's revisions to FHA's lender approval and operational requirements:
• Single Family Loan Origination Lending Area. The single family origination lending area (also known as the Area Approved for Business or AAFB) for approved mortgagees now includes all HUD field office jurisdictions, subject to lenders meeting each state's origination requirements. For purposes of any Credit Watch Terminations, the AAFB will be maintained at the HUD field office jurisdiction level. This change eliminates the geographical restrictions previously imposed upon approved lenders, which limited an approved lender's FHA origination activity to the designated lending areas for each home office and registered branch office.
• Office Facilities. HUD no longer has approval requirements for a lender's branch office facilities, including traditional, non-traditional and direct lending branch offices. Loan origination and/or servicing activities may be conducted from an approved mortgagee's home office, branch office, and/or direct lending branch office. However, all office facilities, regardless of type, must fully comply with all state licensing requirements in effect in the jurisdiction in which the office facility is located.
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