The cost of recertifying the branch office of a Federal Housing Administration mortgagee is being changed.
Within 90 days of their fiscal year end, FHA lenders are required to pay annual recertification fees in order to maintain approval as an FHA mortgagee. Fees are paid for the home office and each FHA-approved branch office.
Up to this point, mortgagees could terminate a branch office after the start of the annual reported period but before the recertification fees were paid. But that practice has led to incorrectly calculated fees.
So in Mortgagee Letter 2012-27, the Department of Housing and Urban Development said that changes to the calculation of recertification fees on its internal systems means that the number of FHA-approved branches will be based on how many branches were approved on the first business day of the lender’s reporting period.
“As of the effective date of this Mortgagee Letter, lenders that wish to terminate branches and thereby not pay a recertification fee for the next annual period must do so on or before the last business day of the annual reporting period,” HUD said. “Lenders attempting to terminate branches after the last day of their annual reporting period will not be permitted to do so until the annual recertification fees have been paid in full.”
The revisions to the calculation of recertification fees is immediately effective.
