7/27/2019 HUD FHA Mortgagee Letter ML 2009-01
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January 6, 2009
MORTGAGEE LETTER 2009-01
TO: ALL APPROVED MORTGAGEES
SUBJECT: ANNUAL RENEAL O! !"A APPROVAL
The purpose of this Mortgagee Letter is to reflect revised HUD
policy regardingDepartmental action in cases where mortgagees or
lenders fail to meet annual renewal of FHAapproval requirements and
to update the relevant Handboo provisions! "n order to maintain
itsstatus as an FHA#approved mortgagee$ a mortgagee is required$
among other things$ to timely fileannual audited financial
statements that meet the requirements of the %ecretary$ sign and
submit a
yearly verification report and pay an annual fee for its main
and registered branch offices!
The Department considers the timely annual renewal of FHA
approval requirements to becritical to its ability to adequately
monitor and assess the condition of the mortgagee and determineif
the mortgagee poses a ris to the Department$ its programs or the
public! A mortgagee&s failure torenew its FHA#approval in a
timely manner has caused significant e'penditures of staff time
andoffice resources! Moreover$ many mortgagees have repeatedly
failed to comply with theDepartment&s filing deadlines! Thus$
in order to bring more mortgagees into compliance with
theDepartment&s statutory and regulatory mandates$ the
Department is rescinding paragraph (#) ofHUD Handboo (*+*!,$ -./#0!
Through final rule published on 1ctober ,*$ 0**2$ HUD revisedits
Mortgagee -eview 3oard regulations! To prevent potential conflicts
with the revised
regulations$ HUD is now removing this paragraph from the
Handboo! Accordingly$ any failure ofa mortgagee or a lender to
comply with annual renewal of FHA#approval requirements may
bereferred to the Mortgagee -eview 3oard for its consideration as
provided for in 0( 4!F!-! 5art 06!
"n the past$ if a mortgagee failed to meet one or more of these
annual renewal requirements$the Department would send that
mortgagee a 7otice of /iolation and the mortgagee was permittedto
rectify the violation and enter into a settlement agreement with
the Department that required themortgagee to pay a 8,$*** fee! This
process was e'plained in HUD Handboo (*+*!,$ -./#0$paragraph (#)!
The Department will no longer permit mortgagees to settle the
matter prior toconsideration by the Mortgagee -eview 3oard! The
mortgagee may$ however$ cure the violation$which will be taen into
account by the Mortgagee -eview 3oard when it considers the
matter!
Mortgagees must now appeal the 7otice of /iolation in accordance
with the regulations at0( 4!F!-! 5art 06 and the matter will be
considered by the Mortgagee -eview 3oard! TheMortgagee -eview 3oard
may$ among other things$ impose penalties and9or withdraw
themortgagee&s FHA#approval or permit the Department to enter
into a settlement agreement! Thesanctions available to the
Mortgagee -eview 3oard may be found at 0( 4!F!-! : 06!6! "f
amortgagee&s FHA#approval is terminated$ that mortgagee may not
reapply for FHA approval until,0 months after the effective date of
their termination!
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The provisions within this Mortgagee Letter are effective
immediately! All other FHAguidelines and requirements not
superceded by this Mortgagee Letter remain in effect!
"f you have any questions regarding this Mortgagee Letter$
please call FHA&s -esource
4enter at ,#2**#4ALL#FHA ;,#2**#006#6 by calling ,#2??#TDD#0HUD
;,#2??#2
