Think you missed my interpretation of "originate". HUD is the government department that oversees/regulates & gave birth to the FHA loan program. In other words, they "originated" the FHA loan program. I know banks make (originate) the loans. My point is that the FHA loans are over-regulated and nick-picked to death when loan losses occur as they inevitably will with the lower loan underwriting standards they have. I think the banks are learning that its not worth it trying to make these loans as the legal risk is huge & lawyers to fight the battle are expensive.
FHA loans were sub-prime before anyone knew what a sub-prime loan was. FHA loans originate from the good folks at HUD which spelled backwards is DUH. Most of the big mortgage lenders have about quit originating FHA loans as they are more time-consuming to originate, over-regulated, servicing is a nightmare, then HUD will sue you when the losses start piling up on their end. Notice that it took from 2012 to settle this thing. My guess is WFC settled to make them go away. I think HUD should go away.