Federal Register / Vol. 73, No. 171 / Wednesday, September 3, 2008 / Notices 51505 

1First time homebuyers who receive approved 

counseling pay an up-front premium not to exceed 

2.0%. Section 2114 of the FHA Modernization Act 

(Title I of Division Be of Public Law 110–289, 

approved July 30, 2008) increased the maximum 

level of the upfront premium to 3 percent except 

for first time homebuyers. The maximum level for 

first time homebuyers was increased to 2.75 

percent. 

DEPARTMENT OF HOUSING AND 

URBAN DEVELOPMENT 

[Docket No. FR–5171–N–03] 

Federal Housing Administration (FHA) 

Single Family Mortgage Insurance: 

Announcement of Moratorium on RiskBased Premiums 

AGENCY: Office of the Assistant 

Secretary for Housing—Federal Housing 

Commissioner, HUD. 

ACTION: Notice. 

SUMMARY: Consistent with the Housing 

and Economic Recovery Act of 2008, 

signed into law on July 30, 2008, this 

notice announces a one-year 

moratorium, commencing October 1, 

2008, on premium pricing in accordance 

with FHA’s risk-based premium 

structure. This structure was set for 

most Title II single family mortgage 

insurance programs by a May 13, 2008, 

notice, which provided for 

implementation commencing on July 

14, 2008. This notice provides 

directions for FHA-approved mortgagees 

to ensure their compliance with the 

moratorium that commences October 1, 

2008. 

FOR FURTHER INFORMATION CONTACT: 

Margaret E. Burns, Director, Office of 

Single Family Program Development, 

Department of Housing and Urban 

Development, 451 Seventh Street, SW., 

Washington, DC 20410; telephone 

number 202–708–2121 (this is not a tollfree number). Persons with hearing or 

speech impairments may access this 

number through TTY by calling the tollfree Federal Information Relay Service 

at 800–877–8339. 

SUPPLEMENTARY INFORMATION: 

I. Background 

By notice published by HUD in the 

Federal Register on September 20, 2007 

(72 FR 53872), FHA announced its plan 

to implement risk-based premiums for 

FHA loans and included the following 

information in the notice. Section 

203(c)(2) of the National Housing Act 

(12 U.S.C. 1709(c)(2)) provides for 

upfront and annual mortgage insurance 

premiums for most FHA single family 

programs. Such upfront and annual 

insurance premiums are set at levels not 

to exceed 2.25 percent 1 and 0.50 

percent (0.55 percent for mortgages 

involving an original principal 

obligation that is greater than 95 percent 

of the appraised value of the property), 

respectively, with a discount available 

on the upfront premiums for some 

mortgagors who are first-time 

homebuyers and who successfully 

complete pre-purchase homeownership 

counseling approved by the Secretary. 

FHA proposed a range of premiums 

based on risk, so that it would be able 

to offer options to: (1) Mortgagees 

serving borrowers who were previously 

underserved, or not served, by the 

conventional marketplace; and (2) 

mortgagees serving those borrowers 

wishing to lower their premiums by, for 

example, increasing their downpayment 

or by improving their credit scores. 

Additionally, FHA noted that offering a 

range of premiums based on risk helps 

to ensure the future financial soundness 

of FHA programs that are obligations of 

the Mutual Mortgage Insurance Fund 

(MMIF or the Fund). 

The September 20, 2007, notice 

solicited public comment. Following 

consideration of public comments, on 

May 13, 2008 (73 FR 27704), FHA 

issued a notice announcing its riskbased premium structure, which 

included changes made in response to 

public comment, and an 

implementation date of July 14, 2008. 

II. Authority for, and Purpose of, This 

Notice 

On July 30, 2008, the President signed 

into law the Housing and Economic 

Recovery Act of 2008 (Pub. L. 110–289, 

122 Stat. 2654, approved July 30, 2008). 

Title I of Division B is the FHA 

Modernization Act of 2008 (Act). 

Section 2133 of the Act places a one 

year moratorium on FHA’s 

implementation and carrying out of its 

risk-based premium structure 

commencing October 1, 2008. Section 

2132 of the Act directs HUD to provide 

by notice additional requirements 

necessary to immediately carry out the 

Act. Consistent with this section, HUD 

is providing early notice to FHAapproved mortgagees of steps to be 

taken to ensure compliance with section 

2133. 

Accordingly, this notice provides 

directions to FHA-approved mortgagees 

for the timely and orderly transition 

into, and out of, the statutory 

moratorium on risk-based premiums. 

Given the commencement of the 

moratorium on October 1, 2008, FHAapproved mortgagees are expected to 

begin modifying their systems and 

processes for compliance with the 

moratorium on risk based pricing in 

accordance with this notice. In addition 

to the directions provided in this notice, 

FHA’s Web site at http://www.fha.gov 

provides operational questions 

anticipated to be asked by FHAapproved mortgagees and provides the 

answers to these questions. 

III. Applicability of Statutory Period 

Section 2133 requires that HUD ‘‘shall 

not take any action to implement or 

carry out risk-based premiums’’ for a 12- 

month period beginning on October 1, 

2008. HUD considers that this 

moratorium is intended to establish a 

clearly delineated, one-year period to 

cease FHA’s risk-based pricing of single 

family mortgage insurance premiums, 

but is not intended to disrupt the 

reasonable expectations of borrowers 

and mortgagees participating in the 

FHA-insured mortgage lending process. 

The statute and the risk-based premium 

notice can be read consistently to 

address such concerns. The May 13, 

2008, notice stated that the risk-based 

premium structure ‘‘is effective for new 

FHA case number assignments made on 

or after July 14, 2008.’’ (See 73 FR 

27710.) Since the risk-based premium is 

effective at the point at which a new 

FHA case number assignment is made, 

HUD considers the risk-based premium 

to be carried out at that point. 

Accordingly, the statutory moratorium 

shall be effective and carried out on 

October 1, 2008 for new FHA case 

number assignments made on or after 

that date. Again, HUD expects that all 

FHA-approved mortgagees will begin 

taking immediate steps to modify their 

systems and procedures to assure 

compliance with this requirement by 

October 1, 2008. 

The moratorium will continue for a 

12-month period, applying to new FHA 

case number assignments made through 

and including September 30, 2009. In 

this way, the applicability of the term of 

the statutory period is clearly 

established, and all participants in the 

FHA-insured mortgage lending process 

may adequately prepare for full 

compliance with the statute. Mortgages 

with FHA case number assignments 

made on July 14, 2008, through and 

including September 30, 2008, shall 

maintain the risk-based premium 

structure for the life of the mortgage. 

IV. Directions to FHA-Approved 

Mortgagees on Premium Pricing During 

Moratorium 

FHA is not authorized to, and will 

not, insure any mortgages for which 

new FHA case number assignments are 

made on or after October 1, 2008 and 

before October 1, 2009, for which the 

premium has been set in accordance 

with the May 13, 2008 notice. 


sroberts on PROD1PC70 with NOTICES
51506 Federal Register / Vol. 73, No. 171 / Wednesday, September 3, 2008 / Notices 

The upfront and annual premiums on 

mortgages for which new FHA case 

number assignments are made on or 

after October 1, 2008 and before October 

1, 2009, are as follows: 

Upfront Premiums: FHA will charge 

an upfront premium in an amount equal 

to the following percentages of the 

mortgage: 

• Purchase Money Mortgages and 

Full-Credit Qualifying Refinances = 1.75 

Percent 

• Streamline Refinances (all types) = 

1.50 Percent 

• FHASecure (Delinquent 

Mortgagors) = 3.00 Percent. 

Annual Premiums: An annual 

premium, shown in basis points below, 

to be remitted on a monthly basis, will 

also be charged based on the initial 

loan-to-value ratio and length of the 

mortgage (except for FHASecure 

delinquent mortgages) according to the 

following schedule: 

• Purchase Money Mortgages, FullQualifying Refinances, and Streamline 

Refinances: 

LTV Annual for Loans 

>15 years LTV Annual for Loans ≤15 years 

≤95 ........................................................................ 50 ≤90 ........................................................................ None 

>95 ........................................................................ 55 >90 ........................................................................ 25 

• FHASecure (delinquent 

mortgagors): 

LTV Annual 

(all loan terms) 

≤95 ................................ 50 

>95 ................................ 55 

FHA will issue another notice that 

will formally advise when the 

moratorium is concluded and the 

premium pricing structure that should 

be followed once the moratorium ends. 

V. Additional Premium Pricing 

Requirements 

All FHA-approved mortgagees must 

begin to modify their systems and 

procedures to be in compliance with the 

following additional requirements 

applicable to any mortgages for which 

new FHA case number assignments are 

made on or after October 1, 2008 and 

before October 1, 2009: 

1. The LTV ratio, computed to two 

decimals (e.g., 95.65) is calculated by 

dividing the mortgage amount prior to 

adding on any upfront mortgage 

insurance premium by the property’s 

sale price or appraised value, whichever 

is lower. 

2. Borrowers who have decision credit 

scores below 500 must have loan-tovalue ratios less than 90 percent to 

qualify for an FHA-insured mortgage. 

3. A ‘‘decision credit score’’ is 

determined for each applicant according 

to the following guidelines: when three 

scores are available (one from each 

national consumer reporting agency: 

Equifax, TransUnion, and Experian), 

the middle value is used; when only 

two are available, the lesser of the two 

is chosen; when only one is available, 

then that score is used. If more than one 

individual is applying for the same 

mortgage, the lender should determine 

the decision credit score for each 

individual borrower and then use the 

lowest score to determine the final 

decision credit score for the application. 

4. All borrowers with eligible decision 

credit scores must be scored by TOTAL. 

5. The premium rates established in 

this notice apply to those forward 

mortgages insured under FHA’s Mutual 

Mortgage Insurance (MMI) fund, the 

Section 203(k) rehabilitation mortgage 

insurance program, and individual 

condominium units insured under 

Section 234(c). The premiums in this 

notice do not apply to mortgages 

insured under Title I of the National 

Housing Act, nor to reverse mortgages 

under FHA’s Home Equity Conversion 

Mortgage (HECM) program. The 

premiums in this notice also do not 

apply to Section 223(e) (declining 

neighborhoods), Section 238(c) (military 

impact areas in Georgia and New York), 

Section 247 (Hawaiian Homelands), and 

Section 248 (Indian Reservations). 

Dated: August 26, 2008. 

Brian D. Montgomery, 

Assistant Secretary for Housing—Federal 

Housing Commissioner. 

[FR Doc. E8–20299 Filed 9–2–08; 8:45 am] 

BILLING CODE 4210–67–P 

DEPARTMENT OF THE INTERIOR 

Fish and Wildlife Service 

[FWS–R3–R–2008–N00168; 30136–1265– 

0000–S3] 

Seney National Wildlife Refuge, 

Schoolcraft County, MI 

AGENCY: Fish and Wildlife Service, 

Interior. 

ACTION: Notice of availability: draft 

comprehensive conservation plan and 

environmental assessment; request for 

comments. 

SUMMARY: We, the U.S. Fish and 

Wildlife Service (Service), announce the 

availability of a draft comprehensive 

conservation plan (CCP) and draft 

environmental assessment (EA) for 

Seney National Wildlife Refuge (NWR) 

for public review and comment. In this 

draft CCP/EA, we describe how we 

propose to manage the refuge for the 

next 15 years. 

DATES: To ensure consideration, we 

must receive your written comments by 

October 8, 2008. An open house style 

meeting will be held during the 

comment period to receive comments 

and provide information on the draft 

plan. Special mailings, newspaper 

articles, Internet postings, and other 

media announcements will inform 

people of the meetings and 

opportunities for written comments. 

ADDRESSES: Send your comments or 

requests for more information by any of 

the following methods. You may also 

drop off comments in person at Seney 

NWR. 

• Agency Web site: View or download 

a copy of the document and comment at 

http://www.fws.gov/midwest/planning/ 

Seney. 

• E-mail: r3planning@fws.gov. 

Include ‘‘Seney Draft CCP/EA’’ in the 

subject line of the message. 

• Fax: 906–586–3800. 

• Mail: Refuge Manager, Seney 

National Wildlife Refuge, 1674 Refuge 

Entrance Road, Seney, MI 49883–9501. 

FOR FURTHER INFORMATION CONTACT: 

Tracy Casselman, 906–586–9851 Ext 11. 

SUPPLEMENTARY INFORMATION: 

Introduction 

With this notice, we continue the CCP 

process for Seney NWR, which was 

started with the notice of intent we 

published in the Federal Register on 

April 21, 2006 (71 FR 20722). For more 

about the initial process and the history 

of this refuge, see that notice. Seney 

NWR was established in 1935 by 

Executive Order under the Migratory 

Bird Conservation Act for the protection 

and production of migratory birds and 

other wildlife. The Refuge encompasses 

approximately 95,238 acres; of this area, 

25,150 acres comprise the Seney 

Wilderness Area, in which is contained 

the Strangmoor Bog National Natural 


sroberts on PROD1PC70 with NOTICES