The Federal Housing Administration (FHA) is looking to bring banks back to its program. They have promised lighter False Claims Act enforcement and other steps, but most experts say they will need to update their servicing processes in order to make any meaningful progress. “Their servicing requirements are sort of anachronistic. They haven’t been updated recently, and [they’re] not aligned with the industry standards that we use in servicing loans for the GSEs, in particular,” said Pete Mills, Senior Vice President of Residential Policy at the Mortgage Bankers Association. Currently, 19 of the top 20 lenders in the FHA program are nonbanks, a fact that the FHA hopes to change soon.

Read more via American Banker.