Categorized | Finance and Mortgage

240 Lenders Face Adverse Action from FHA

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The Federal Housing Administration, or FHA, has continued its crackdown against lenders who have violated various requirements. Such actions were taken to ensure ethical practices among the mortgage lending companies.

As the real estate market continues to face uncertainty, the FHA is taking action against lenders to ensure that they are following their strict guidelines and standards. Two hundred and forty FHA-approved lenders have recently suffered the consequences of failing to adhere to such standards, and thus, are now facing a multitude of penalties that range in severity. The penalties against the companies in violation include reprimands, probations, suspensions, fines, and even temporary and permanent revocation of licenses.

The adverse actions aren’t limited to any specific part of the country, as lenders from multiple cities have been hit. This action taken by the FHA Mortgage Review Board is not a one-time incident, as over the last two years, nearly two thousand companies have been punished for violating FHA standards. Some lenders believe that the actions taken by the Federal Housing Administration are causing a negative impact to the real estate market, and driving it to be even more uncertain. However, the FHA has taken the stance that by enforcing their standards, they will help make neighborhoods more secure.

It has yet to be seen, though, how these adverse actions against lenders will actually influence or affect the real estate market. If there is one certainty that has come about as a result of such actions being taken, it is that more lenders are becoming aware of the possibility of such recourse, and are making any necessary adjustments in their lending patterns.

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About Drew Wilson

Drew focuses on the Commercial and Mortgage/Finance categories.

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