FHA multifamily origination breaks record
The Federal Housing Administration endorsed $10.5 billion in multifamily rental housing loans during its fiscal 2011, a new record with still another month and a half to go. The FHA fiscal year ends in October. So far, it endorsed nearly 1,100 multifamily loans, seven times the amount three years ago. For only the second time, loan activity surpassed $10 billion. For the entire industry, commercial and multifamily originations doubled in the second quarter from last year, according to the Mortgage Bankers Association. "FHA has never been more relevant in making sure the multifamily apartment marketplace continues to function even during these tough economic times," said Carol Galante, FHA’s acting commissioner. "While we're seeing record volume, we also recognize we have to accelerate the time it takes us to process these applications so we continue to meet this demand at the very time the market needs us the most." The FHA published new guidelines to cut the amount of time required to approve loan applications. According to the guidelines, the Department of Housing and Urban Development will take 45 days from when it receives a complete pre-application to when it issues a letter asking the lender to apply for a commitment. When HUD receives the commitment applications, it will take 60 days to approve. Earlier in the year, the FHA began using new multifamily loan closing documents which hadn't been updated in 40 years. Write to Jon Prior. Follow him on Twitter @JonAPrior.