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Mortgagee Review Board

The Mortgagee Review Board (Board) is authorized to take administrative action against HUD/FHA approved lenders that are not in compliance with FHA approval and lending requirements. The Mortgagee Review Board Division reviews cases that are referred and works with the Office of General Counsel to ensure cases are fact-based and meet legal sufficiency. The cases before the Board involve lenders who inadvertently or knowingly and materially violate HUD/FHA program statutes, regulations and handbook requirements. These lenders are subject to administrative sanctions by the Board. For serious violations, the Board can withdraw a lender's FHA approval to participate in FHA programs. In less serious cases, the Board enters into settlement agreements to bring them into compliance. The Board can also impose civil money penalties, suspend or place lenders on probation, and issue Cease and Desist letters as well as, issue Letters of Reprimand.

Some of the cases that are heard before the Board include, but are not limited to:

  • Failure to implement, perform and maintain a Quality Control Plan;
  • Failure to perform loss mitigation and service loans in accordance with HUD/FHA requirements;
  • Failure to adequately document the source of funds issues regarding the borrower's required investment for the down payment (e.g., improperly documented gift letters, insufficient funds to close, use of unacceptable source of funds, and improperly documented source of funds);
  • Failure to document income, assets and liabilities of the borrower (e.g., failure to document discrepancies between the credit report and credit application);
  • Appraisal violations (e.g., poor comparables, inducements to purchase, unsubstantiated value adjustments, unsupported values based on the information available, unreported physical deficiencies, and property "flip transactions");
  • False statements to HUD/FHA and/or false certifications;
  • Charging unallowable fees;
  • Failure to comply with FHA's annual recertification requirements;
  • Improper branch operations (e.g., allowing unlicensed, Debarred or Limited Denial of Participation employees to originate or work on HUD/FHA insured loans).

Voting Members of the Board:

  • Assistant Secretary for Housing-Federal Housing Commissioner (serves as the Chair of the Board)
  • HUD's General Counsel;
  • Ginnie Mae President;
  • Assistant Secretary for Administration;
  • Chief Financial Officer;
  • Assistant Secretary for Fair Housing and Equal Opportunity.

Non-voting Advisors to the Board are:

  • HUD's Inspector General;
  • Director of FHA Office of Lender Activities and Program Compliance;
  • FHA Chief Risk Officer;
  • General Counsel's Office of Program Enforcement.

The Director of the Mortgage Review Board Division serves as the Secretary to the Board.

If you have any questions, please contact the FHA Resource Center at answers@hud.gov or (800) 225-5342.