HUD Proposes Waiving Registration Requirement for Branches
HUD has recently published a proposed rule (the Proposal) that would eliminate the requirement at 24 C.F.R. § 202.5(k) that a mortgagee must register with HUD each branch office at which the mortgagee originates mortgages or submits mortgage insurance applications. The Proposal would further amend 24 C.F.R. § 202.5(i) to tie the additional fees described in that regulation to branch offices that the mortgagee chooses to register with HUD, instead of every branch office that is authorized to originate Title I loans or submit mortgage insurance applications. HUD notes in the Proposal that mortgagees could choose to register branch offices with HUD in order to be placed on HUD’s Lender List Search page, although this would appear to subject such branch offices to the aforementioned fees.
HUD suggests that this registration requirement is no longer necessary in light of technological advancements in the mortgage industry, and is potentially redundant because of branch licensing requirements under the SAFE Act. HUD further states that even without branch office registration, HUD will still be able to monitor mortgagee activities.
Comments on the Proposal are due by May 1, 2023.