New York Adopts Regulation Regarding Determination Of Subprime Home Loans

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On September 30, the New York Department of Financial Services (NY DFS) advised supervised institutions that it adopted emergency regulations to determine if a home loan qualifies as a subprime home loan under Section 6-m of the New York Banking Law. The NY DFS determined that recent changes to the calculation of mortgage insurance premiums mandated by the Federal Housing Administration in Mortgagee Letter 2013-04, which increased the annual percentage rate on subject loans, effectively decreased the threshold on certain loans and limited the availability of mortgage credit in New York. In response, the emergency regulations adjust the subprime threshold up by 75 basis points for most FHA-insured loans. The change took effect immediately.

Topics:  FHA, Mortgages, Premiums, Subprime Mortgages

Published In: Finance & Banking Updates, Insurance Updates, Residential Real Estate Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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