[Federal Register Volume 77, Number 71 (Thursday, April 12, 2012)]
[Notices]
[Pages 21991-21992]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-8679]
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DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
[Docket No. FR-5444-N-02]
Federal Housing Administration (FHA): Multifamily Accelerated
Processing (MAP)--Lender and Underwriter Eligibility Criteria and
Credit Watch for MAP Lenders
AGENCY: Office of the Assistant Secretary for Housing--Federal Housing
Commissioner, HUD.
ACTION: Notice.
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SUMMARY: This proposed notice provides additional, detailed information
to FHA-approved lenders and members of the public about HUD's processes
for determining lender and underwriter eligibility and tier
qualification for MAP participation. This proposed notice accompanies
HUD's proposed rule on the same topic, published elsewhere in today's
Federal Register. This notice includes the quantity, specific
characteristics, and recentness of transactions that a lender or
underwriter must have undertaken in order to qualify for each tier of
MAP approval.
DATES: Comment Due Date: June 11, 2012.
ADDRESSES: Interested persons are invited to submit comments on this
notice to the Regulations Division, Office of General Counsel,
Department of Housing and Urban Development, 451 7th Street SW., Room
10276, Washington, DC 20410-0500. Communications must refer to the
above docket number and title. There are two methods for submitting
public comments. All submissions must refer to the above docket number
and title.
1. Submission of Comments by Mail. Comments may be submitted by
mail to the Regulations Division, Office of General Counsel, Department
of Housing and Urban Development, 451 7th Street SW., Room 10276,
Washington, DC 20410-0500.
2. Electronic Submission of Comments. Interested persons may submit
comments electronically through the Federal eRulemaking Portal at
www.regulations.gov. HUD strongly encourages commenters to submit
comments electronically. Electronic submission of comments allows the
commenter maximum time to prepare and submit a comment, ensures timely
receipt by HUD, and enables HUD to make them immediately available to
the public. Comments submitted electronically through the
www.regulations.gov Web site can be viewed by other commenters and
interested members of the public. Commenters should follow the
instructions provided on that site to submit comments electronically.
Note: To receive consideration as public comments, comments
must be submitted through one of the two methods specified above.
Again, all submissions must refer to the docket number and title of
the rule.
No Facsimile Comments. Facsimile (FAX) comments are not acceptable.
Public Inspection of Public Comments. All properly submitted
comments and communications submitted to HUD will be available for
public inspection and copying between 8 a.m. and 5 p.m. weekdays at the
above address. Due to security measures at the HUD Headquarters
building, an advance appointment to review the public comments must be
scheduled by calling the Regulations Division at 202-402-3055 (this is
not a toll-free number). Individuals with speech or hearing impairments
may access this number via TTY by calling the Federal Relay Service,
toll-free, at 800-877-8339. Copies of all comments submitted are
available for inspection and downloading at http://www.regulations.gov.
FOR FURTHER INFORMATION CONTACT: Terry W. Clark, Office of Multifamily
Development, Office of Housing, Department of Housing and Urban
Development, 451 7th Street SW., Room 6134, Washington DC 20410;
telephone number (202) 402-2663 (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 Relay Service at 800-877-
8339.
SUPPLEMENTARY INFORMATION:
I. Background
Under its proposed rule, published elsewhere in today's Federal
Register, HUD would revise 24 CFR part 200, subpart Y, to provide for
tiered approval of new and existing MAP lenders and underwriters, such
that only lenders and underwriters with adequate experience and
qualifications could underwrite loans involving more complex
multifamily housing programs and transactions.
II. Purpose
This proposed notice provides the tiered MAP approval lender and
underwriter experience requirements referenced in the proposed
amendment to 24 CFR part 200, ``Multifamily Accelerated Processing
(MAP); MAP Lender Quality Assurance Enforcement.'' Under the terms of
the proposed rule, HUD may establish and
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from time to time propose to revise these experience requirements for
new and existing MAP lenders and underwriters, as market conditions or
HUD's experience indicate would be prudent to adequately protect the
FHA General Insurance Fund from unacceptable risk, through notice and
the opportunity for public comment. The purpose of this notice is to
propose the minimum number and type of closings required for MAP lender
and underwriter approval at each qualification tier, and the time frame
within which the loans must have closed within the tier to be found by
HUD to be acceptable experience.
This practice would mitigate risk, since MAP lenders and
underwriters will now be approved at a tier level commensurate to their
demonstrated experience.
III. Tier Approval Experience Requirements
As would be provided in Sec. 200.1411(b) of the proposed rule, an
FHA lender or underwriter may use MAP to process or underwrite only
those loan transactions that are covered by the lender or underwriter's
MAP approval tier. The tiers are as follows:
Tier 1: Acquisition and refinancing programs (i.e., the FHA 223(f)
or 223(a)(7) programs) without government subsidies;
Tier 2: Acquisition and refinancing programs (i.e., the FHA 223(f)
or 223(a)(7) programs) with or without government subsidies;
Tier 3: All MAP-eligible programs (i.e., the FHA 220, 223(f),
223(a)(7), 221(d), 231, and 241 programs) without government subsidies;
and
Tier 4: All MAP-eligible programs (i.e., the FHA 220, 223(f),
223(a)(7), 221(d), 231, and 241 programs), with or without government
subsidies.
In accordance with Sec. 200.1413(b) and Sec. 200.1415(b) of the
proposed rule, a MAP lender or underwriter would be approved at a tier
level commensurate with the lender or underwriter's experience in
underwriting and in processing transactions that are covered by that
tier, or in underwriting and processing equivalent non-FHA loan
transactions. (A non-FHA transaction may be deemed equivalent to a
given FHA-covered loan transaction as provided in Sec.
200.1413(b)(1)(i) or Sec. 200.1415(a)(1), as applicable.) To qualify a
lender or underwriter for MAP approval at a tier level, the loan
transactions would be required to have closed and to be of the
quantities, characteristics, and recentness provided in the following
table:
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Tier Experience requirements
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Tier 1............ Five firm commitments issued or closings of 223(f)
or closing of equivalent transactions within the
past 5 years.
Tier 2............ Five firm commitments issued or closings of 223(f)
or closing of equivalent transactions within the
past 5 years, and at least three of the
transactions must have been with government
subsidies.*
Tier 3............ Five firm commitments issued or closings of 220,
221(d), 231, 232, or 241 or equivalent transactions
within the past 5 years.
Tier 4............ Five firm commitments issued or closings of 220,
221(d), 231, 232, or 241 or equivalent transactions
within the past 5 years, and at least three of the
transactions must have been with government
subsidies.*
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* See section II.A of the proposed rule's preamble for a discussion of
qualifying government subsidies.
The requirement for new and existing lenders and underwriters to
have undertaken five transactions within 5 years in order to
demonstrate qualification at a tier represents an increase compared to
HUD's current policy of requiring underwriters to have undertaken three
transactions within 3 years for general MAP approval. HUD has observed
that lenders whose underwriters had only three qualifying transactions
within 3 years have often had insufficient familiarity with the
programs and their responsibilities under the MAP program. To ensure
appropriate management of risk to the FHA insurance fund, it is
essential that new and existing MAP lenders and underwriters have
adequate transactional experience before they undertake their first
transaction pursuant to their MAP approval at a given tier. HUD,
therefore, proposes to increase the minimum number of transactions to
five, but, accordingly, to provide that the transactions must have
occurred within 5 years of when approval is sought, rather than within
3 years.
Dated: March 16, 2012.
Carol J. Galante,
Acting Assistant Secretary for Housing--Federal Housing Commissioner.
[FR Doc. 2012-8679 Filed 4-11-12; 8:45 am]
BILLING CODE 4210-67-P