The Department of Housing and Urban Development terminated the ability of a JPMorgan Chase (JPM: 39.90 +0.66%) branch on Long Island to originate mortgages insured by the Federal Housing Administration.
The action took place Monday against the branch at 900 Stewart Avenue in Garden City, N.Y. in Nassua County. Also Monday, HUD stripped another 20 mortgage companies of their ability to write FHA-approved mortgages.
HUD terminates approvals if enough FHA-insured loans originated at one branch no longer perform. If a branch's FHA defaults exceed 200 within two years, the approval can be stripped. Lenders who lose origination approval can still purchase, hold, or service the loans. A terminated lender can apply for reinstatement after six months if it has maintained certain requirements.
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