TopCompliance ALERT Logo
  April 14, 2010
                                         FHA: Net Worth and Lender Approval
                                              Advance Issuance Final Rule



Mortgage Compliance

Service Presentations

CORE Compliance

About Us

Our Clientele

News & Views Posts



Contact Us

LCG - Link

Visit Us!
LCG Weblog - 1
Visit Us!


Mortgage Compliance

Due Diligence

Defaults and Claims

Forensic Mortgage Audit

FHA Examinations

Legal Reviews/Remedies

CORE Compliance Matrix

Loss Mitigation

Mortgage Fraud Audit

Quality Control



Business Development

Policy Guides/QC Plans

IT and IS

Disaster Recovery Plans



Email Us

Mailing List Rainbow

On September 18, 2009 Commissioner David Stevens announced a set of credit policy changes that are meant to enhance FHA's risk management function, including the hiring of a Chief Risk Officer for the first time in the agency's 75-year history. In addition, Stevens announced his intent to propose new regulations to further strengthen FHA's risk management.

The new regulations include higher net worth requirements and streamline lender approval procedures.

FHA has issued today an advance copy of the upcoming new final rule to be published in the Federal Register. The date of publication in the Federal Register determines the effective date of this Final Rule, as well as other dates as identified in the Final Rule.

Net Worth Requirements
  • Effective one year following the enactment of this final rule:
  1. Current FHA approved lenders - with the exception of small businesses - must possess a minimum net worth of $1 million;
  2. Current FHA approved small business lenders must possess a minimum net worth of $500,000.
  • Effective three years following the enactment of this provision:
  1. Approved lenders and applicants to FHA single-family programs must have a net worth of $1 million plus 1% of total loan volume in excess of $25 million.
  2. Approved lenders and applicants to FHA multifamily programs must have a minimum net worth of $1 million.
  • Multifamily lenders that also engage in mortgage servicing must  have an additional 1% of total volume in excess of $25 million.
  • Multifamily lenders that do not perform mortgage servicing must have an additional 0.5% of total loan volume in excess of $25 million.
Streamline Lender Approval
  • While mortgage brokers will continue to be able to originate FHA-insured loans through their relationships with approved lenders, they will no longer receive independent FHA eligibility approval. Mortgage brokers or other third-party originators, already approved by FHA, will be authorized to continue to originate FHA-insured loans through the end of the calendar year without sponsorship of an FHA-approved lender. Commencing January 1, 2011, however, the origination authority will end.
 Visit our Library for Issuance     
Action Button Image 1
Continuation of FHA Reform-
Strengthening Risk Management through Responsible FHA-Approved Lenders
24 CFR Part 202
[Docket No. FR 5356-F-02]
April 14, 2010

Action Button Image 1

Lenders Compliance Group
is a full-service, mortgage risk management firm, providing professional guidance to financial institutions in all areas of mortgage compliance.


Mortgage Compliance
Compliance Administration
Defaults and Claims Reviews
Forensic Mortgage Audit
Business Development
Mortgage Fraud Audit
Quality Control
FHA Examinations
State and Federal Examinations
Fannie/Freddie/Ginnie Applications
Mortgage Due Diligence
Legal Reviews & Remedies
Loss Mitigation Compliance
HMDA & CRA Reviews
Disaster Recovery Plan
IT & IS Compliance
Statutory Licensing

This communication is sent to our valued clients and colleagues, who regularly receive our Advisory Bulletins, Mortgage Compliance Updates,  Compliance Alerts, Licensing Alerts, and News and Views.

These publications are free to subscribers. Information contained herein is not intended to be and is not a source of legal advice.

2010 Lenders Compliance Group, Inc. All Rights Reserved.