The Federal Housing Administration is moving to electronic loan endorsements for its best direct-endorsement lenders with acceptable claim and default ratings, starting Jan. 1.The new endorsement process, called "lender insurance," eliminates the need for FHA lenders to send loan case binders to the FHA. The agency also announced in a mortgagee letter that it has redesigned its appraisal requirements to make them less cumbersome, and that it is adopting Fannie Mae appraisal forms. These changes are expected to make offers by FHA homebuyers more acceptable to real estate agents. The changes are part of an overhaul of the whole FHA single-family program to make it more competitive in the marketplace.

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