According to new report from the Mortgage Bankers Association (MBA), the Federal Housing Authority (FHA) commissioner should be granted the resources to better manage the agency through the current housing market crisis and to allow the agency to continue to thrive when the market recovers. Increasing resources for staffing and technology are among the 12 recommendations to improve the FHA and the Government National Mortgage Association (Ginnie Mae) by the MBA's Council on the Future of FHA and Ginnie Mae. Convened in November 2009, the council consists of senior executives from 27 companies, representing both large national lenders and small independent mortgage bankers.
"FHA and Ginnie Mae are cornerstones of the U.S. housing market as they provide access to mortgage loans for millions of first-time, and low- and moderate-income homebuyers. MBA members support both of these institutions," said MBA Chairman Robert E. Story Jr., CMB. "MBA has long advocated for changes that will help guarantee a strong FHA and Ginnie Mae."
For FHA, the report recommends that:
►Congress give FHA and Ginnie Mae appropriations to hire and train new staff.
►Congress provide FHA with appropriations to develop and implement modern information technology (IT) systems and processes, including anti-fraud tools. FHA should also refine its TOTAL Scorecard.
►FHA's mission be updated and redefined, including a re-examination of the current FHA loan limits.
►FHA strengthen its reverse mortgage product (Home Equity Conversion Mortgage (HECM)).
►Congress provide FHA with the expanded authority to increase premiums.
►Congress give the FHA Commissioner the authority, with the concurrence of the HUD Secretary, General Counsel and Ginnie Mae president, to temporarily suspend problem lenders.
►FHA balance its proposed multifamily risk management protocol against the backdrop of rising affordable housing needs, declining incomes and the ongoing credit crisis.
►FHA should examine the existing Homeownership Center and Hub structure.
The paper also recommends that Ginnie Mae:
►Examine appropriate staff levels.
►Maintain its exemption from the Credit Reform Act of 1990.
►Modify its policy regarding advance funding facilities.
►Clarify its Home Equity Conversion Mortgage MBS issuer criteria.
The paper, "The Future of the Federal Housing Administration (FHA) and the Government National Mortgage Association (Ginnie Mae)," also offers observations on the recent past and future of FHA (including the HECM and multifamily programs) and Ginnie Mae products and programs.
The full 40-page report, The Future of the Federal Housing Administration (FHA) and the Government National Mortgage Association (Ginnie Mae), can be accessed at the link below.
For more information, visit www.mortgagebankers.org.