Servicers Generally Did Not Meet HUD Requirements When Providing Loss Mitigation Assistance to Borrowers With Delinquent FHA-Insured Loans
We performed an audit of loan servicers’ compliance with the Federal Housing Administration’s (FHA) requirements for providing loss mitigation assistance to borrowers after their COVID-19 forbearance ended. We initiated the audit based on the large number of borrowers exiting forbearance, because the loss mitigation programs available to these borrowers were new and created a risk for both borrowers and the FHA insurance fund when servicers do not properly provide loss mitigation. Our audit objective was to determine whether servicers provided borrowers of FHA-insur
Nationstar Generally Did Not Meet HUD Requirements When Providing Loss Mitigation to Borrowers of Delinquent FHA-Insured Loans
We audited Nationstar Mortgage, LLC’s (doing business as Mr. Cooper (Nationstar)) compliance with the Federal Housing Administration’s (FHA) requirements for providing loss mitigation assistance to borrowers after their COVID-19 forbearance ended. We concurrently conducted a nationwide audit of servicers’ compliance with the U.S. Department of Housing and Urban Development’s (HUD) COVID-19 loss mitigation requirements (HUD Office of Inspector General (OIG) Report 2023-KC-0005).
Virgin Islands Housing Finance Authority Ineffectively Monitored CDBG-DR Activities
We audited the Virgin Islands Housing Finance Authority’s monitoring of its Community Development Block Grant Disaster Recovery (CDBG-DR)-funded activities. We initiated the audit because of the large amount of CDBG-DR funds awarded to the U.S. Virgin Islands for the 2017 disasters and to aid in the U.S.
The Virgin Islands Housing Finance Authority’s Administration of Its Non-Federal Match Program Had Weaknesses
We audited the Virgin Islands Housing Finance Authority’s Non-Federal Match Program for Community Development Block Grant Disaster Recovery (CDBG-DR) funds. This Match Program was developed to assist non-Federal entities in paying for their share of projects that addressed unmet needs because of the 2017 Hurricanes Irma and Maria. We initiated this audit due to the $415 million of CDBG-DR funds allocated by the Authority and to support the U.S.