Lenders can expect to see some changes and clarification with how the Federal Housing Administration will handle defect taxonomy and their guidelines. Today, the FHA posted its Single Family Loan Quality Assessment Methodology or Defect Taxonomy, which explains how FHA intends to categorize loan defects found in Single Family FHA endorsed loans today.
According to the FHA, single family currently uses 99 different codes to label defected loans. Once the taxonomy is in place, it will only be nine options to choose from. These codes will identify the source and cause of the defect and offer some additional information concerning the significance of a given deficiency within each category. This will provide lenders with the information they need to originate loans efficiently and reduce errors that could lead to enforcement actions.
When purchasing a home, it’s important to consider the extra or hidden costs. Many homeowners are blissfully unaware of just how much these additional fees can costs on top of their mortgage. Zillow and Thumbtack recently released a study that found homeowners can pay more than $9,000 in hidden and home maintenance costs every year.