WASHINGTON (AP) — The Federal Housing Administration is proposing stricter rules for lenders to reduce its risk and insure it can cover future losses.
The agency proposes to require lenders to have a net worth of at least $1 million in the first year and $2.5 million within three years. That’s up from the original requirement of $250,000.
The FHA also wants to tighten approval requirements for lenders who want to originate, underwrite or service FHA loans and make them liable for those loans, including ones originated by mortgage brokers.
There is a 30-day comment period on the proposals.