We audited the U.S. Department of Housing and Urban Development (HUD), Office of Multifamily Housing Programs’ efforts to address multifamily mortgage application processing delays.  When applications for these loans are delayed, it slows the production and availability of affordable multifamily housing units.  During the COVID-19 pandemic, HUD took action to eliminate a backlog of over 500 applications waiting to be assigned to…

We audited the Federal Housing Administration (FHA), Office of Asset Sales’ U.S. Department of Housing and Urban Development (HUD)-Held Vacant Loan Sales (HVLS) program.  The audit objective was to assess the extent to which HUD achieved its mission objectives for a 2022 vacant loan sale.  We noted deficiencies in 52 of 53 HUD-approved applications within the reviewed vacant loan sale.  These deficiencies occurred in transactions…

We audited the U.S. Department of Housing and Urban Development (HUD), Office of Single Family Housing’s Federal Housing Administration (FHA) Resource Center’s handling of housing discrimination inquiries.  We initiated the audit to assist HUD with ensuring that the FHA Resource Center (1) provided accurate and complete information on potential housing discrimination to its customers and (2) ensured that instances of potential housing…

Develop a control to detect loans that did not maintain the required flood insurance to put $1.5 billion to better use by avoiding potential future costs to the FHA insurance fund from inadequately insured properties. Corrective Action Taken In November 2022, FHA published the Acceptance of Private Flood Insurance for FHA-Insured Mortgages final rule (Docket No. FR-6084-F-02) in the Federal Register and issued Mortgagee Letter 2022-18,…

We audited the U.S. Department of Housing and Urban Development’s (HUD) oversight of Federal Housing Administration (FHA) refunds based on a hotline complaint alleging that HUD was trying to make it difficult for claimants to obtain refunds or discourage them from pursuing the refunds, which are due to eligible homeowners from the unearned portion of the upfront mortgage insurance premium paid.  Our audit found the allegations from the…

The U.S. Department of Housing and Urban Development (HUD), Office of Inspector General (OIG), completed a corrective action verification (CAV) of recommendations from four prior home equity conversion mortgage (HECM) audit reports.  The CAV was initiated because protecting the Federal Housing Administration (FHA) mutual mortgage insurance fund is one of HUD’s top management challenges.  The prior audits determined that HUD lacked…

In June 2020, we received letters from members of Congress, including the chairpersons of the House Committee on Financial Services and Oversight and Investigation Subcommittee, expressing concern that the U.S. Department of Housing and Urban Development (HUD) imposed a new, nonpublic, and legally erroneous policy that prohibited issuing Federal Housing Administration (FHA)-insured loans to Deferred Action for Childhood Arrivals (DACA)…

We audited selected general and application controls over the Federal Housing Administration’s (FHA) Home Equity Reverse Mortgage Information Technology (HERMIT) system as part of the internal control assessments required for the fiscal year 2019 financial statement audit under the Chief Financial Officer’s Act of 1990.  Our objective was to review the selected controls over HERMIT for compliance with U.S. Department of Housing and Urban…

The West Calumet Housing Complex (WCHC), located in East Chicago, IN, was a public housing development that opened in 1972 on top of a former lead smelting plant.  HUD and other agencies missed multiple opportunities to identify site contamination at WCHC.  As a result, WCHC residents continued living in unsafe conditions for decades, and inadequate oversight led to the lead poisoning of children in WCHC.  Between 2005 and 2015, a…

As part of the Office of Inspector General’s (OIG) effort to provide oversight of the U.S. Department of Housing and Urban Development’s (HUD) relief efforts provided by the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), we reviewed HUD’s responses to inquiries regarding forbearance and foreclosure relief.  The objective of our review was to evaluate the accuracy of HUD’s responses to inquiries from borrowers, industry…

In 2016, we began a series of audits in accordance with our goal to review the U.S. Department of Housing and Urban Development’s (HUD) multifamily housing programs.  We issued five reports detailing violations found at Project-Based Rental Assistance (PBRA) properties in HUD’s Southwest Region.  This assignment is a rollup of those five reports.  In addition, we reviewed HUD’s controls to ensure that its housing assistance…

This report presents the results of our audit of FHA’s principal financial statements and notes for the fiscal years ending September 30, 2019 and 2018, including our report on FHA’s internal control and test of compliance with selected provisions of laws, regulations, contracts, and grant agreements. In our opinion, FHA’s fiscal years 2019 and 2018 financial statements were presented fairly, in all material respects, in accordance with the U.S…

The U.S. Department of Housing and Urban Development (HUD), Office of Inspector General audited Federal Housing Administration (FHA)-insured loans from fiscal year 2018.  Our audit objective was to determine whether FHA provided insurance on loans that were made to ineligible, delinquent Federal tax debtors. We found that FHA insured at least 56,376 loans worth $13 billion, which were not eligible for insurance because they were made to…

We completed a corrective action verification (CAV) of recommendations 1A and 1C from prior OIG audit report 2015-LA-0001 (issued April 20, 2015).  The CAV was initiated based on preliminary analysis, which identified potential ineligible partial claims.  The prior audit determined that the Federal Housing Administration’s (FHA) claim payment system failed to identify two types of ineligible partial claims.  As part of its…

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 completing the loan modifications and reinstating the loans.  Our audit objective was to determine whether FHA improperly paid partial claims that did not reinstate the delinquent loans. We found…

We audited selected general and application controls over the Federal Housing Administration’s Computerized Homes Underwriting Management System as part of the internal control assessments required for the fiscal year 2018 financial statement audit under the Chief Financial Officer’s Act of 1990.  Our objective was to review the effectiveness of controls for compliance with HUD information technology policies and Federal information system…

The Chief Financial Officers Act of 1990 (Public Law 101-576), as amended, requires the Office of Inspector General to audit the financial statements of the Federal Housing Administration (FHA) annually. We audited the accompanying financial statements and notes of FHA as of and for the fiscal years ending September 30, 2018 and 2017 (restated), which are comprised of the balance sheets, related statements of net cost and changes in net…

The U.S. Department of Housing and Urban Development (HUD) Office of Inspector General (OIG) worked with HUD’s Office of Lender Activities and Program Compliance, Office of Single Family Housing, to resolve outstanding matters related to two September 2015 agreements with Fifth Third Bank (FTB) and its principal subsidiary, Fifth Third Bancorp, an Ohio-based bank holding company.  HUD failed to properly record required indemnifications in…

We audited the U.S. Department of Housing and Urban Development’s (HUD) Federal Housing Administration’s (FHA) preforeclosure sale claim process based on an internal Office of Inspector General audit suggestion noting that existing regulations may allow excessive preforeclosure claim interest costs.  Our audit objective was to determine the amount of unnecessary preforeclosure claim interest and other costs that resulted from lender…

We performed a review of the U.S. Department of Housing and Urban Development’s (HUD) Housing Counseling Program, located within the Office of Housing Counseling.  We selected this program based on an audit suggestion that was included in our annual audit plan to help address HUD’s strategic goal to strengthen the housing market to bolster the economy and protect consumers.  Our objective was to determine whether HUD adequately…