Questions and Answers
The established criteria for HUD to approve a refund are:
A refund of a monthly (periodic) premium payment can be requested through HUD's Single Family Insurance Operations Division (SFIOD). On the FHA Connection, go to the Monthly Premums menu and select Request a Refund in the Pay Periodic (Monthly) Premium section. The Monthly Premiums Refund Request page appears for entering refunds for up to 10 cases. When the refund request is successfully processed, an e-mail message confirming receipt of the request by SFIOD is sent to the user that requested the refund. The e-mail address on record for the user on the FHA Connection is used. (The lender's FHA Connection Application Coordinator can update the user's e-mail address, if necessary.)
The refund check is sent to the Premium address on record in HUD's Lender Electronic Assessment Portal (LEAP) for the institution.
Upon request, you must submit documentation needed to support the refund.
When you request a refund, the maximum number of cases on each check is 10. The number of checks you receive will depend on how many cases were included in your email request and the number of separate requests you made.
Monthly (periodic) premium refund checks are being sent to the wrong address. How can this be corrected?
A refund check is sent to the lender's Premium address on record in HUD's Lender Electronic Assessment Portal (LEAP). The Premium address can be viewed and corrected in LEAP, which is accessed from the FHA Connection's Lender Functions menu.
It may take up to 60 days to complete the normal processing of your request after HUD receives it. For monthly (periodic) refunds, once your refund shows a CONF status, you should receive your check within 10 - 14 days. You can monitor the status of your monthly refunds using the Refund Transactions report file available on the FHA Connection or through the Alternate Report Retrieval process (secure file transfer process).
If I paid monthly (periodic) premium for a case in error, can the funds be transferred to a case in my portfolio instead of getting a refund?
Yes. In lieu of a refund, a reallocation request can be made to transfer the funds to a case in your portfolio.
Can I request a refund for monthly (periodic) premium paid in error for a case I do not service or hold?
Yes. If you made a payment in error for a case that was not in your portfolio, you can request a refund. However, if FHA insurance on the loan was terminated (case has a status of T), the refund request must be made within 90 days of the error. Otherwise, a refund from HUD can only be requested if the refund amount for the case is not greater than the excess premium amount (i.e., unapplied amount) on the case. If the refund amount is greater than the case's excess premium amount, or there is not excess premium, you must request the difference (or the entire refund) from the current servicer or holder of the case.
FHA insurance was terminated on a case (loan) I service/hold. Can I request a refund for monthly (periodic) premium paid for the case?
A refund can be requested under these conditions:
What happens if a refund causes a shortage of monthly (periodic) premium on a case that I service/hold?
If the shortage is not remedied in a timely manner, the missing amount and a late charge are included in the next monthly bill. Your Reconciliation report file will show an M02 discrepancy type for the case.
The Refund Transactions report file provides information about refunds for your FHA cases that were created or had a change in status during the current month. The Refund Transactions report file is available on HUD's FHA Connection website or, for high volume lenders and service bureaus, through the Alternate Report Retrieval process. The Refund Transactions report file is updated weekly, available every Monday. On the first day of the month, it is updated again and includes all the refund transactions for the previous month.
After signing on to the FHA Connection, select Single Family FHA, followed by Single Family Servicing, then Monthly Premiums. Select the Retrieve Files button to access your files.
Do you have access to the FHA Connection? If not, the FHA Connection Welcome page includes links to detailed information about the website. The FHA Connection Registration Procedures [PDF] module of the FHA Connection Guide provides information on FHA Connection registration. (See also Mortgagee Letters 98-13 [DOC] and 97-14 [TXT].)
The Refund Transactions report file remains available for three months. Three months worth of the latest Refund Transactions report files, including the current month's, are available to view or download.
Three months worth of the latest Refund Transactions report files are available on the FHA Connection.