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Housing program reports rising volume, no delinquencies; staff recommends phasing lender compensation
Summary
Staff reported 149 loans in the last 12 months totaling about $32 million, no delinquencies and pull-through near 100%. The board discussed phasing down a 300-basis-point lender compensation over time and asked for a pro forma on runway.
Staff presented an update on the authority’s home-financing program, reporting steady growth in lender participation, strong performance metrics and options to adjust lender compensation.
The presenter said the program completed 149 loans in the most recent rolling 12-month period — including 34 conventional, 108 FHA and seven VA loans — totaling about $32,000,007.23. "Our pull through rate has never been below 90%," the presenter said, adding that the program has been at or near 100% for several months and that there were currently no delinquencies.
Why it matters: High pull-through and low delinquency improve pricing and the program’s value to the master servicer, which staff said helps the local program secure top-tier pricing even though it operates at much lower volume than larger state agencies.
Board members pressed on underwriting and pricing choices. Staff noted the authority lowered the FHA minimum credit score from 660 to 640 in June and suggested expanding the conventional product off the HFA-advantage construct in 2026 to broaden appeal. "If we can get off that HFA advantage, I think it would open up the program significantly," staff said.
The board also debated the 3% (300 basis points) compensation currently included in loan pricing. Staff recommended gradually reducing the compensation — for example, by an eighth of a point (50 bps) each quarter or every six months — and offered to provide a pro forma showing the program’s runway and the trustee balances held at Bank of Oklahoma to evaluate fiscal impact. "We could flip that switch in a day or two," staff said of pricing adjustments managed through US Bank and Mark’s team.
On VA loans, staff and members discussed whether lenders are avoiding the program because non-allowable fees make compensation unattractive; staff said raising lender compensation for VA loans by about 50 basis points might offset lenders’ costs.
Next steps: Staff will prepare a pro forma and bring more detailed pricing options to a future meeting. The board did not adopt immediate pricing changes at this meeting.
Attributions: Quotations attributed to staff and unnamed board members using the meeting transcript.
