[Federal Register Volume 77, Number 29 (Monday, February 13, 2012)]
[Proposed Rules]
[Page 7558]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-3289]
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DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
24 CFR Part 202
[Docket No. FR-5416-N-02]
RIN 2502-AI91
Withdrawal of Proposed Rule on Approval of Farm Credit System
Lending Institutions in Federal Housing Administration (FHA) Mortgage
Insurance Programs
AGENCY: Office of the Assistant Secretary for Housing--Federal Housing
Commissioner, HUD.
ACTION: Withdrawal of proposed rule.
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SUMMARY: This notice withdraws HUD's August 2011 rule that proposed to
amend HUD's regulations to enable the direct lending institutions of
the Farm Credit System to seek approval to participate in the FHA
mortgage insurance programs as approved mortgagees and lenders.
DATES: The proposed rule is withdrawn February 13, 2012.
FOR FURTHER INFORMATION CONTACT: Office of Lender Activities and
Program Compliance, Department of Housing and Urban Development, 451
7th Street SW., Washington, DC 20410-8000; telephone number 202-708-
1515 (this is not a toll-free number). Persons with hearing or speech
impairments may access this number through TTY by calling the toll-free
Federal Information Relay Service at 800-877-8339.
SUPPLEMENTARY INFORMATION:
I. Background
On August 26, 2011, at 76 FR 53362, HUD published a proposed rule
that would enable the direct lending institutions of the Farm Credit
System to seek approval to participate in the FHA mortgage insurance
programs as FHA-approved mortgagees and lenders. In the proposed rule,
HUD noted that recent difficulties in mortgage finance markets
indicated reduced availability of housing credit in rural areas. HUD
therefore proposed to extend FHA mortgagee and lender eligibility to
the lending institutions of the Farm Credit System to provide an
additional avenue for mortgage financing in rural areas. The Farm
Credit System is a federally chartered network of borrower-owned
lending institutions composed of cooperatives and related service
organizations. The public comment period for the proposed rule closed
on October 25, 2011. HUD received approximately 27 substantive public
comments in response to the August 26, 2011, proposed rule. Certain
comments were identical in substance, having been submitted as part of
mailing campaigns. The public comments on this rule can be found at
http://www.regulations.gov/#!searchResults;rpp=10;po=0;s=FR-5416-P-01.
The commenters were almost evenly divided in their support of and
opposition to the rule. Those commenters that supported the rule stated
that there was indeed a need for available housing credit in rural
areas and that allowing Farm Credit lending institutions to be FHA-
approved lenders would aid in the necessary extension of credit. The
commenters stated that the Farm Credit System has been a source of
consistent and reliable credit for rural homeowners and that the
ability to provide the option of FHA programs to families in rural
areas will help ensure that the borrowing needs of rural families are
met. Those commenters that opposed the rule stated that there was no
need to expand FHA mortgage availability to Farm Credit member
institutions; that the banking community was satisfactorily meeting the
need for credit in rural areas. The commenters opposing the rule also
stated that it was their view that approval of Farm Credit lending
institutions to originate FHA insured loans runs afoul of the
Administration's proposal to reduce government involvement in the
housing finance market.
Upon consideration of the issues raised by public comments, HUD is
withdrawing the August 26, 2011, proposed rule. While HUD seeks to
ensure the availability of mortgage financing for qualified borrowers
nationwide--and particularly in underserved areas--HUD and the
Administration remain committed to reducing FHA's market share and
facilitating the return of private capital to the housing finance
market. Therefore, in concert with its network of FHA-approved lending
partners, FHA will continue to monitor the adequacy of mortgage credit
in rural areas to ensure that rural residents have access to
homeownership.
Accordingly, the proposed rule to amend 24 CFR 202.10, published on
August 26, 2011, at 76 FR 53362, entitled ``Approval of Farm Credit
System Lending Institutions in FHA Mortgage Insurance Programs,'' is
hereby withdrawn.
Dated: February 7, 2012.
Carol J. Galante,
Acting Assistant Secretary for Housing--Federal Housing Commissioner.
[FR Doc. 2012-3289 Filed 2-10-12; 8:45 am]
BILLING CODE 4210-67-P