HUD Finalizes Streamlined FHA Reporting Rule

HUD FHA

On September 17, HUD issued a final rule that streamlines the FHA financial statement reporting requirements for lenders and mortgagees who are supervised by federal banking agencies and whose consolidated assets do not meet the thresholds set by their supervising federal banking agencies for submission of audited financial statements—currently set at $500 million in consolidated assets. HUD’s regulations currently require all supervised lenders and mortgagees to submit annual audited financial statements as a condition of FHA lender approval and recertification. Effective October 17, 2013, in lieu of the annual audited financial statements, small supervised lenders and mortgagees will be required to submit their unaudited financial regulatory reports that align with their fiscal year ends and are required to be submitted to their supervising federal banking agencies. Only if HUD determines that the supervised lenders or mortgagees pose heightened risk to the FHA insurance fund would such lenders be required to submit audited financial statements. The final rule also makes technical changes to current regulations regarding reporting requirements for FHA-approved supervised lenders and mortgagees.