| ID | Status | Date | Public/Private | Industry | AHACPA Contact |
|---|---|---|---|---|---|
| #9704 | Closed | public | FHA Lender |
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FHA had a rule for decades stating that a mortgage lender could make FHA loans in the state where it had an office and then to the states contiguous to or in the office’s region. The basis for this rule is provided in Sec. 2-19 of HUD Handbook 4060.1, which references there being more information within the FAQ section of FHA connection which no longer appears active. I heard last year that this rule had gone away, such that a lender can now make FHA loans anywhere in the county so long as they are appropriately licensed by the states involved. Is this true? |
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The answer to your question is YES, that is true. In the new Single Family Housing Policy Handbook, 4000.1 under I. A. I. A. 4. Branch Offices b. Single Family Lending Area i. Definition An “Area Approved for Business” (AAFB) is the geographic area in which a Mortgagee’s home or branch office is permitted to originate or underwrite FHA Mortgages. The AAFB is subdivided into HUD Field Office jurisdictions. The Mortgagee’s AAFB can be viewed through LEAP. The jurisdiction of each HUD Field Office can be verified on www.hud.gov/lenders under the Mortgage Origination tab through the link titled “HUD Office Jurisdictions.” ii. Standard All branch offices registered by a Mortgagee will initially be granted a nationwide AAFB. The branch may only exercise its authority to originate or underwrite FHA Mortgages in those states where the Mortgagee fully complies with state origination and/or underwriting licensing and approval requirements. |