HOMEfires - Vol. 5 No. 1, April 2003

Information by State  Print version

Q. Can non-profit organizations removed from the FHA Non-profit Organization Roster participate in the HOME Program?

A. Non-profit organizations are important participants in HUD's efforts to further affordable housing opportunities for low- and moderate-income persons through the Federal Housing Administration (FHA) single-family programs. The special role provided for non-profit organizations in FHA regulations is intended only for those organizations that are financially viable and actively involved in the furthering of affordable housing in their communities.

On June 6, 2002, HUD published a final rule establishing procedures for developing and maintaining a roster of qualified non-profit organizations, as well as for removing poorly performing non-profit organizations. Through the Office of Single-family Program Development (OSFPD), FHA maintains a Non-profit Organization Roster to provide a means for mortgagees and the general public to verify that non-profit organizations are qualified to participate in specified FHA activities. These placement and removal procedures protect participants in the FHA single-family programs and safeguard FHA insurance funds.

FHA's criteria for removing a non-profit organization from its roster is found at 24 CFR 200.195(a). These criteria include:

1. Failure to comply with applicable single-family regulations, Mortgagee Letters or other written instructions or standards issued by HUD;
2. Failure to comply with applicable Civil Rights requirements;
3. Holding a significant number of FHA-insured mortgages that are in default, foreclosure, or claim status;
4. Being debarred or suspended, subject to limited denial of participation, or otherwise sanctioned by HUD;
5. Failure to further all objectives described in the affordable housing narrative;
6. Misrepresentation or fraudulent statements; or
7. Failure to respond within a reasonable time to HUD inquiries, including recertification requests or other requests for further documentation.

There are four Homeownership Centers (HOCs) under OSFPD that manage the Non-profit Organization Roster. The contact person and address of these HOCs are as follows:

Many non-profit developers that participate in the FHA Single-family Housing Programs also participate in the HOME Program as Community Housing Development Organizations (CHDOs), other non-profit developers, or subrecipients. Consequently, PJs may have a need to verify the FHA single-family insurance participant status of the Non-profit Organization Roster with which they are working. Not all non-profit organizations participate in HUD programs causing them not to be placed on the roster. It is important to understand that removal from FHA's Non-profit Organization Roster does not however, prohibit an organization from participating in the HOME Program unless it also has been debarred. PJs concerned about the status of organizations with which they are doing business may wish to contact the appropriate HOC. PJs interested in obtaining information on its non-profit organizations should consult HUD's website at www.hud.gov to determine the appropriate HOC to contact. After opening the website, find "Housing Industry" and click on "Lenders." Under General Information, click on HUD Homeownership Centers. Select the state where the PJ is located.