General World News

FHA seeks mortgage defect taxonomy changes for cases of TPO fraud, misrepresentation

The Federal Housing Administration (FHA) this week announced a proposed Mortgagee Letter (ML) that would add fraud and misrepresentation to its defect taxonomy list for Title II FHA-sponsored mortgage financing.

The defect taxonomy includes a list of attributes that FHA can use to identify potential defects at the loan level based on policy requirements from the U.S. Department of Housing and Urban Development (HUD). The newly proposed ML adds fraud or misrepresentation involving a third-party originator as a “tier 1 severity defect,” since lenders are details ⇒

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