www.hudclips.org U. S. Department of Housing and Urban Development Washington, D.C. 20410-8000 April 21, 1997 OFFICE OF THE ASSISTANT SECRETARY FOR HOUSING-FEDERAL HOUSING COMMISSIONER MORTGAGEE LETTER 97-14 TO: ALL APPROVED MORTGAGEES SUBJECT: Single Family Loan Production - The FHA Connection, access via the Internet In accordance with President Clinton's established National Performance Review of 1993 to develop and implement strategies to make the Federal government more efficient, more responsive to customers, and less costly to taxpayers, FHA is establishing "The FHA Connection". The FHA Connection is an interactive system on the Internet that gives approved FHA lenders real-time access to several FHA systems for the purpose of originating loans. Starting October 20, 1997, it will be mandatory for Direct Endorsement lenders to process case number assignments, inspector assignments, appraisal information, case cancellations, receive insurance and retrieve loan data electronically. Lenders will be able to request access to "The FHA Connection" starting immediately and use FHA Connection's different functions as the different phases of FHA Connection are implemented. Mortgagees will have the ability to: Request FHA case number assignments Request appraiser reassignments Request case queries Request refinance authorizations Request insurance Request inspector assignments Request loan data Request case cancellations Transfer cases to other lenders Transfer cases to other sponsors Request CAIVRS authorizations Request reports Query approval lists Register underwriters Request HECM insurance Register automated underwriter systems* Create IMF sponsor relationships* Add Title I branches* Add Title II branches* Create authorized agents for Title II* Change IMF addresses* Inquiry IMF addresses* * Future enhancements not assigned to a phase On October 20th, 1997, for all cases including HECM, appraisers will be required to mail their appraisals and one copy to the lender. Appraisals should no longer be mailed to the Field Office by the appraiser. The lender will be required to enter the appraisal information into the electronic system prior to receiving insurance. When mailing the HUD case binder into the Field Office, lenders are to include the appraisal copy provided by the appraiser. Lenders who originate HECM loans will need to enter the appraisal information when they get the appraisal in order for the systems to calculate the MIP. PHASES The implementation of The FHA Connection will be released in three phases. The first phase is available immediately and will consist of: Underwriter Registry Loan data Appraiser Reassignment CAIVRS authorization Case Query Lender/Sponsor Transfer The second phase which will be completed by July 28, 1997, will be comprised of: Case Number Assignment Insurance request Inspector Assignment Case Cancellation Refinance Authorization HECM insurance The third phase will be implemented by October 20, 1997. This phase will allow mortgagees to query FHA's approval lists. This will include: Appraisers Condominiums Inspectors Mortgage Limits PUD's Notice of Return (NOR) Presently, if the mortgage is determined to be ineligible for insurance, the HUD closing clerk will issue a Notice of Return (NOR) and include the reasons for non-insurance and any corrective actions that must be taken by the lender. Under the new process prior to submitting the case binder to FHA, FHA Connection users will receive immediate feedback on reasons for possible non-insurance in the form of an electronic error or message. Mortgagees will have to correct any errors before the case should be submitted for insurance. The types of error messages that have to be corrected by the mortgagee prior to sending in the case binder for insurance include: Monthly payment error Maturity date or term of loan error First payment date or closing date error MIP error Underwriter error Loan to value error Investor unit error Condo or PUD error MIP late due error Screen help A help icon is located on each screen to assist you. The help window will brief the user to the functions, valid data entries, a description of the data entry fields, and a description of the information that will be returned. The help screens should be consulted prior to calling FHA for help with the data entry fields. Accessing the FHA Connection To access the FHA Connection, you must have Internet access to the World Wide Web and an SSL-compliant browser (Netscape 2.02 or higher, or Microsoft's Internet Explorer version 3). You can access the FHA Connection from the HUD WEB page, or in the browser, type in the URL: "https://entp.hud.gov/clas". Once you have your user ID, double-click on "Sign On", and you will be prompted for your FHA-assigned User ID. Please note that both entries, User ID and Password, will be case-sensitive. Obtaining user ID's Two types of user ID's will be issued, Application Coordinator and standard. A maximum of two Application Coordinator ID's may be issued per lender at the corporate level. Each mortgagee at the corporate level must designate their Application Coordinators prior to requesting standard ID's. The mortgagee's Application Coordinators will be responsible for supplying authorization for the different applications that are available on the FHA Connection to each employee. They will be able to accomplish this through the FHA Connection's ID Maintenance screen which will only be accessible to the Application Coordinators. The Application Coordinators will be able to give employees of their company access to the different applications (e.g. Case Query, Appraiser Reassignment, Insurance processing, etc.), and remove ID's on the ID Maintenance screen. In order to get an Application Coordinator's ID, the designated Application Coordinator must complete the FHA Application Coordinator Registration form which resides on FHA Connection's web site. Each Application Coordinator will need to provide: Name Social Security Number Mortgagee ID E-mail address Mother's Maiden Name Desired Password System Applying for After successfully completing the form, the system will generate a user ID which will be mailed to the President/CEO. The President/CEO will have to give the coordinator their ID when it is received through the mail. If the President/CEO feels the applicant should not receive this ID, they may contact the help line to have the ID terminated. Once an Application Coordinator has their ID, the system will allow other employees to request a standard ID for themselves. Employees can accomplish this through the FHA Connection ID Registration form. They will have to indicate that they are requesting a standard user ID, and similar information as the Application Coordinator. After successfully completing the registration, the FHA Connection system will generate an ID. The Application Coordinator will then be able to retrieve the ID's from the system and grant the proper authorizations to the individual staff for each user. Passwords will only be reset by calling the FHA help line at Sorry, the number originally given for the help line is now obsolete. If you have questions regarding the data fields, screens, or help menus, you can e-mail FHA. All other questions should be addressed to the local FHA Office. Sincerely yours, Nicolas P. Retsinas Assistant Secretary for Housing- Federal Housing Commissioner