HUD is forecasting that the Federal Housing Administration will endorse $288.7 billion of single-family loans in fiscal year 2011, a 9.4% decline from FY 2010, which ended September 30.
The Department of Housing and Urban Development also projects that originations of FHA-insured reverse mortgages will fall 11% in 2011 to $19 billion, despite the introduction of a new HECM Saver product.
Endorsements of Home Equity Conversion Mortgages fell 30% in FY 2010 to $21.1 billion. FHA hopes originations of HECM Savers will cross-subsidize the standard HECM product, allowing the reverse mortgage program to escape credit losses that might lead to a Congressional appropriation.
Based on information published in its October 'Single-Family Outlook' report, FHA believes total foreclosures will level off in FY 2011. The agency projects 100,000 foreclosures in 2011, compared to 99,650 in FY 2010.
Servicers will complete 185,000 FHA loan modifications and other loss mitigation actions in 2011, compared to 183,000 the previous year, the agency believes.
Meanwhile, mortgage bankers funded $24.4 billion of FHA single-family loans in October, flat from the previous month.
The October report also shows that the percentage of FHA-insured loans that are 90 days or more past due fell to 8%, compared to 8.4% in September.
