The Federal Housing Administration today issued new certifications that lenders writing FHA-insured loans will have to make. As urged by ABA in comments last fall, the FHA edged back from proposed language that could have limited the ability of lenders to participate in the program.
“In this final loan-level certification, FHA is clearly identifying [that]lenders will be held accountable for only those mistakes that would have altered the decision to approve the loan,” said FHA head Ed Golding. “This important move makes it very clear that minor mistakes that do not affect the decision to approve a loan are not the focus of our compliance efforts.”
The revised certifications also clarify that lenders are certifying only to the best of their knowledge and do not hold lenders responsible for third-party errors they would have no reason to be aware of. As ABA also urged, the FHA removed references to its pre-endorsement review requirement. For more information, contact ABA’s Joe Pigg.