Provide additional guidance to the servicers so they will limit their communication and collection efforts for the borrowers in forbearance.

We recommend that the Office of Single Family Housing coordinate its efforts with the Office of Public and Indian Housing and the Office of Multifamily Housing Programs to further ensure that appropriate controls are in place to prevent HECM borrowers from violating principal residency requirements.

Request an opinion from HUD’s Office of the Chief Financial Officer’s Appropriation Law Division on whether the abnormal balance in account 4901 constitutes a violation of the Antideficiency Act.

Enhance standard operating procedures around system and account reconciliations to ensure that they cover all possible scenarios and are easy to follow.

Appropriately train and monitor new personnel to ensure that they understand and execute the procedures and controls.

Update procedures to clearly define error thresholds that require follow-up and the communication process for elevating errors to supervisors, managers, and senior leadership.

Establish clear lines of communication within and between divisions to ensure that all personnel become aware of issues that may impact their duties and responsibilities.

Strengthen controls over the preparation of HECM-related reconciliations, reviews, and oversight by ensuring that (1) program personnel preparing such reconciliations understand how such reconciliations impact financial accounting and reporting and (2) financial personnel sufficiently understand programs and systems to determine their general ledger impact.

Enhance the quarterly variance analysis to identify the business reasons for changes in account balances and pay specific attention to abnormal balances and activity.

Strengthen the financial statement review controls by completing a compliance matrix to ensure all balances that are presented and disclosed reflect the most up-to-date financial accounting and reporting guidance.

Perform a comprehensive analysis for all cohort years and assess the impact that the use of the scheduled UPB instead of the current UPB has on the LGL. If significant based on a quantitative threshold, update the SF cash flow model to incorporate the current UPB data.

Develop and implement a new process to require the annual validation of the fourth quarter endorsement volume estimation method for the SF Forward model. The process should include a management review and approval control component. The process should be documented and should demonstrate that management’s estimate is based on the analysis of past experiences, current policy, and market considerations, and, if necessary, incorporate improvement recommendations.

Perform a comprehensive review of the SF and HECM model documentation and update the specific sections with the current practices and procedures required to execute the model activities.

Establish a process that requires the timely review and update of model documentation. The process should include tracking the dates and nature of the revisions.

Provide training and periodic reminders to field staff and management to ensure that the data fields in DAP and on the final Form HUD-290 are accurate and consistent.

Develop and implement written procedures that provide guidance or best practices that should be followed to address data anomalies. At a minimum, these written procedures should include the following: (1) a process for identifying key data attributes that significantly impact the results, (2) the determination of preset thresholds for analyst and management attention, (3) the treatment of data anomalies, such as null values or values that exceed preset thresholds, (4) a process for providing feedback to the upstream data provider(s) for corrective and preventive actions when data integrity issues are detected and management concludes the issue is significant, and (5) a process for preparing documentation to support management decisions.

Develop a comprehensive process to ensure that complaints received by HUD’s Multifamily Housing Clearinghouse are resolved in a timely manner.

Status

In October 2023, the Office of Multifamily Housing reported that it had sought funding for system enhancements to coordinate tenant complaints. HUD is transitioning the Multifamily Clearinghouse responsibilities to the Federal Housing Administration (FHA) Resource Center. The FHA Resource Center has a system that will allow tracking and monitoring of customer calls. As of July 11, 2025, the Office of Multifamily Housing requested the closure of this recommendation because it did not receive the requested funding from Congress for system enhancements, and it believes there is no prospect of future funding. Further, its alternative action of using the FHA Resource Center to track and monitor customer calls did not work. Developing a comprehensive process for intaking, monitoring, and tracking health and safety complaints would require a system enhancement or creation of a new system, and HUD has repeatedly attempted to obtain funding from Congress to no avail. OIG is in the process of collaborating with HUD on finding a potential corrective action to resolve the recommendation.

Analysis

To fully address this recommendation, HUD needs to develop a comprehensive process to ensure that complaints received by HUD are resolved in a timely manner.

Implementation of this recommendation will result in a timelier resolution of complaints submitted by those living in multifamily member housing units.

Develop agencywide policies and procedures for the intake, monitoring, and tracking of health and safety complaints.

Status

In October 2023, HUD stated that it will develop policies and procedures for Multifamily properties for the intake, monitoring, and tracking of health and safety complaints it receives. The Office of Multifamily Housing has not yet updated its policies and procedures. With no comprehensive, automated, real-time system in place, there was no direction to give the field staff, Multifamily Clearinghouse, or the Performance Based Contract Administrators other than what they were already doing. HUD was in the process of developing an automated monitoring system in the FHA resource center to allow tracking of individual calls and the call’s subject, such as health and safety. HUD missed the final action target date of December 31, 2022, and a new completion goal was set for February 2025. As of July 14, 2025, HUD is seeking closure for this recommendation due to unavailability of funds. HUD stated that its issuance of policies and procedures for a comprehensive process was contingent on the development of a tracking system for the complaint process, for which it has repeatedly requested funding from Congress to no avail. OIG is in the process of collaborating with HUD on finding a potential corrective action to resolve outstanding concerns.

Analysis

To fully address this recommendation, HUD must provide evidence that it has developed and implemented policies and procedures for the Multifamily properties for the intake, monitoring, and tracking of health and safety complaints it receives when using the FHA’s automated monitoring system.

Implementation of this recommendation will result in HUD having a more efficient process for taking in, monitoring, and tracking health and safety complaints and aid HUD in more efficiently addressing those complaints.

Develop an automated real-time system for HUD and PBCA staff to use to receive, track, and resolve health and safety issues.

Revise the annual contributions contract to more clearly define the required treatment of health and safety issues, to include: • Specific timeliness requirements for resolving life-threatening and non-life-threatening health and safety issues. • Notification that HUD will actively monitor the status of complaints and become involved in resolution if necessary. • Requirement that PBCAs will immediately contact HUD staff if a property has a life-threatening or non-life-threatening health and safety issue and report when the issue is resolved. • Requirement that the projects’ property management will immediately contact PBCA staff if a property has a life-threatening or non-life-threatening health and safety issue and report when the issue is resolved.