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Report Fraud, Waste and Abuse
  • Recommendation Number: 2019-KC-0001-001-B
  • Status: Open
  • Date Issued: April 11, 2019

Design controls to protect the insurance fund from improper partial claims that did not reinstate the loans to put $27.1 million to better use.

Publication Report

2019-KC-0001 | April 11, 2019

FHA Improperly Paid Partial Claims That Did Not Reinstate Their Related Loans

The U.S. Department of Housing and Urban Development (HUD), Office of Inspector General audited the Federal Housing Administration (FHA) based on the results of another audit, which found that the lender improperly filed for partial claims before… more

Related Recommendations

Housing

  •  
    Status
      Open
      Closed
    2019-KC-0001-001-A
    Closed on November 30, 2020
    $2,342,833.00
    Questioned Costs

    Recommendations with questioned costs identify costs: (A] resulting from an alleged violation of a law, regulation, contract, grant, or other document or agreement governing the use of Federal funds; (B] that are not supported by adequate documentation (also known as an unsupported cost]; or (C] that appear unnecessary or unreasonable.

    Take corrective action against lenders for 43 improper partial claims totaling $2.3 million that did not reinstate the delinquent loans, to include repayment of the partial claims where appropriate. This amount excludes $336,699 for four partial claims that have already been repaid (see appendix D).

  •  
    Status
      Open
      Closed
    2019-KC-0001-001-C
    Closed on July 09, 2021

    Update the FHA-HAMP guidance, clarifying that upon application of the partial claim funds, the mortgage must be fully reinstated with no unpaid amounts.