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Winter Haven, Florida mortgage borrowers should look at a recent HUD announcement regarding mortgage fraud prevention efforts as a positive.

Housing and Urban Development Secretary Shaun Donovan told a Senate appropriations subcommittee today the Fed Housing Administration needs extra resources to guarantee FHA can continue to meet the wants of under-served borrowers in the current mortgage crisis. Donovan also gave evidence that he recently reactivated a program to dispatch groups of investigators to conduct on-site reviews of banks, particularly those whose refinance portfolios are showing evidence of trouble and strangely high default rates.

Donovan emphasized that each effort is being made to reduce risk and confront crime in FHA’s single-family mortgage insurance programs.To read the full text of Donovan’s affidavit, visit HUD’s internet site.

“For FHA to realize its full potential to respond to the current mortgage crisis, it will require additional resources and development of new and innovative reform initiatives,” said Donovan. “The recent mortgage market meltdown has provided ample evidence that we must work to rethink each and every aspect of the nation’s housing finance system.”

As well as the Agency’s normal bank monitoring procedures, FHA plans to extend unannounced on-site inspections of lenders to further reduce the danger of crime. In FHA’s mortgagee letter, banks are reminded the Office expects a strict adherence to FHA’s underwriting standards to guarantee banks.

• Implement and maintain a comprehensive quality control plan,
• Review all loans with early payment defaults;
• Do not engage in false or nonrepresentational advertising;
• Fully document the stability and amount of borrower(s) income; and,
• Do not charge excessive and non-allowable fees to the borrower.

Donovan also appealed to Congress to acceptable extra funds next year to permit FHA to hire more staff to deal with the amazing surge in loan activity. FHA’s role has grown significantly from 3% of lending activity ( by volume in dollars) in 2006 to roughly 30% of all mortgages originated today. But while FHA is presently handling this increased loan volume and handling the concomitant risk, Donovan also warned about the issues confronting the mortgage insurance fund.

Donovan said, “Like many federal domestic agencies, FHA has suffered under the penny-wise and pound foolish priorities of the previous Administration. FHA was stagnant, limiting its ability to maintain adequate staffing levels and invest in state-of-the art technology. Repeated budget stalemates and resulting uncertainty of future funding levels undermined the ability to implement long-term organizational improvements.”

Interested in an FHA Mortgage? Call me at 863-604-3019 or apply online, and we’ll get you set up!

Kevin Sandridge The Florida Mortgage Pro Signature Home Funding 410 Laurel Cove Way Winter Haven, FL 33884

Mobile: 863-604-3019 Fax: 888-496-0265 Email: kevin.s@sigfunding.com http://www.floridahomeloanspecialist.com