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The U.S. Department of Housing and Urban Development (HUD), Office of Inspector General (OIG), assisted the U.S. Department of Justice, Washington, DC, and the U.S. Attorney’s Office, District of Colorado, in the civil investigation of Primary Residential Mortgage, Inc.  Primary has its principal place of business in Salt Lake City, UT.  Primary became an FHA-approved direct endorsement lender on October 15, 1998.  The direct endorsement lender program authorizes private-sector mortgage lenders to approve mortgage loans for FHA insurance.  As a result of Primary’s conduct, HUD insured loans approved by Primary that were not eligible for FHA mortgage insurance under the direct endorsement program and that HUD would not otherwise have insured.

On September 30, 2016, Primary entered into a settlement agreement with the Federal Government to pay $5 million to avoid the delay, uncertainty, inconvenience, and expense of lengthy litigation.  Primary agreed that for 100 FHA-insured loans, it failed to follow all HUD requirements in connection with its origination, underwriting, and endorsement of the loans.  The settlement was neither an admission of liability by Primary nor a concession by the United States that its claims were not well founded.