The Department of Housing and Urban Development has ordered AmericaHomeKey, Inc., to immediately stop making FHA-insured mortgages and fined the Dallas-based lender $268,000.
The HUD's Mortgagee Review Board stripped AmericaHomeKey of its FHA-approved lender status for allegedly engaging in "repeated and serious violations of FHA requirements."
These allegations include failure to verify and document borrowers' incomes and charging "unallowable" fees. HUD cited one property flipping case where AmericaHomeKey approved a $125,000 loan on a property recently purchased for $14,000.
"When we begin to see a pattern of failure to apply our standards, we will act to protect FHA's financial health as well as consumers,” said acting FHA Commissioner Carol Galante. “We expect lenders to meet our requirements, not just to protect the safety of our insurance fund but to make certain they don't set up borrowers to fail by putting them into mortgages they ultimately can't sustain.”
Neighborhood Watch data shows AmericaHomeKey originated over 7,600 FHA-insured single-family loans in the past 24 months and 3.4% or 258 of the loans are 90-days or more past due.
The Dallas-based lender had not commented by press time.
