Effective for case numbers issued October 4, 2010 or after
All FHA Approved Lenders and Sponsored Originators
Changes have been made to FHA Connection to handle transactions where a Direct Endorsement lender (Sponsoring Mortgagee) will underwrite, close and insure an FHA transaction for a Sponsored Originator. For transactions originated by an approved FHA correspondent, the current procedures should be used until the end of the year. As of January 1, 2011 the FHA Correspondent program will no longer exist and the Sponsoring Mortgagee will be responsible for FHA Connection data entry for their Sponsored Originator.
DE Lenders are required to register their Sponsored Originator on FHA Connection's new Sponsored Originator Maintenance Screen. The originator's legal name, EIN (Employer Identification Number), and NMLS (Nationwide Mortgage License System) lender identifier number must be entered to register the Sponsored Originator. Once the Sponsored Originator has been registered in FHA Connection, any Sponsoring Mortgagee may order a case number and originate the transaction.
The case number assignment screen has been modified and provides prompts to identify the transaction as a sponsored loan. Additional data fields have also been added to accommodate case transfers between Sponsored Originators and Sponsoring Mortgagees. Application and Case Query screens have also been changed.
Neighborhood Watch changes are being made to monitor the performance of Sponsored Originators and searches may be done by the Sponsored Originator's legal name or EIN. TOTAL Scorecard enhancements have also been made to accommodate the identification of the Sponsored Originator on the AUS feedback report.
The HUD/VA Addendum to Uniformed Residential Mortgage Application (92900-A) form has been changed to capture Sponsored Originator data. The data includes the Sponsored Originator's legal name, EIN and NMLS lender identification number, if applicable. The Sponsoring Mortgagee, not the Sponsored Originator, must sign page one of the 92900-A, whereas the Sponsored Originator's interviewer will continue to sign page four of the Uniformed Residential Loan Application. The revised 92900-A must be used effective October 4, 2010 if the loan is a sponsored transaction. Effective January 1, 2011 this revised form must be used by all lenders. p>
How does it change or benefit the industry:
This change addresses the elimination of the Correspondent Lender approval status and provides the methods to identify the Sponsored Originator in transactions and track their performance.
About this AllRegs HUD Mortgagee Letter Synopsis: