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Report Fraud, Waste and Abuse
  • Recommendation Number: 2021-KC-0002-001-A
  • Status: Closed
  • Date Issued: January 05, 2021
Closed Date:
July 07, 2022

Require lenders to provide evidence of sufficient flood insurance or execute indemnification agreements for the 43 loans in our statistical sample that did not have sufficient flood insurance at the time of our audit to put nearly $5.2 million to better use.

Publication Report

2021-KC-0002 | January 05, 2021

FHA Insured $940 Million in Loans for Properties in Flood Zones Without the Required Flood Insurance

The U.S. Department of Housing and Urban Development, Office of Inspector General, has completed its audit of Federal Housing Administration (FHA)-insured loans originated in calendar year 2019.  Our audit objective was to determine whether FHA… more

Related Recommendations

Housing

  •  
    Status
      Open
      Closed
    2021-KC-0002-001-B
    Closed on April 25, 2022
    $432,637,444.00
    Funds Put to Better Use

    Recommendations that funds be put to better use estimate funds that could be used more efficiently. For example, recommendations that funds be put to better use could result in reductions in spending, deobligation of funds, or avoidance of unnecessary spending.

    Add to FHA databases the information necessary to ensure that the required flood insurance is in place at loan origination, including flood zone, flood insurance type, flood insurance amount, and site value of the property, and include system checks that prevent endorsement of loans without the required flood insurance to put at least $432.6 million to better use by avoiding potential future costs to the FHA insurance fund.