To: VHDA Originating Lenders
Date: June 27, 2006
Many of our Authorized Agents utilizing the new FHA Lender Insurance Program have experienced difficulty entering VHDA loan data in the FHA Connection to obtain FHA mortgage insurance. This was caused by a recent change FHA made to the FHA Connection. The change requires VHDA, as the Principal, to register in the Lender Insurance Program in order for our Authorized Agents to use their Lender Insurance Approval to obtain FHA mortgage insurance on VHDA loans.
If VHDA registers in the Lender Insurance Program, all VHDA Authorized Agents must endorse all VHDA loans through the Lender Insurance Program. Since many of VHDA’s Authorized Agents have not registered for the Lender Insurance Program, this is not an acceptable option. If VHDA becomes Lender Insurance Approved, our Authorized Agents that have not registered in the Lender Insurance Program will not be allowed to submit case binders to FHA for insurance. Therefore, at this time, VHDA will NOT register in the Lender Insurance Program. Until an alternative solution can be determined, all of VHDA’s Authorized Agents, including those that are Lender Insurance Approved, must submit case binders to FHA for insurance on VHDA loans.
Unfortunately, VHDA did not receive advance notice of this change to the FHA Connection, and we have not had an opportunity to prepare for the unintended consequences. In upcoming weeks we will be communicating with FHA and our lending partners to develop a solution to this issue. We apologize for any inconvenience or inefficiencies that this has created for our lenders.
If you have any questions or need additional clarification, please contact Sheila Pollard at (804) 343-5976 or email@example.com.