CAIVRS stands for Credit Alert Verification Reporting System. It is a system maintained by the federal government that lists the Social Security Numbers of persons with federal debt that is delinquent or in default, or who have had a claim paid on a FHA-insured mortgage within the last three years. Examples of federal debts may include previous FHA or Veterans Administration home loans, Federal student loans, Small Business Administration loans and similar types of debts.
FHA-approved Mortgagees (Lenders) are required to determine whether Borrowers have delinquent federal non-tax debt. Mortgagees may obtain information on delinquent federal debts from public records, credit reports (or equivalent), and must check all Borrowers against CAIVRS. Mortgagees are prohibited from processing an application for an FHA-insured Mortgage for Borrowers with delinquent federal non-tax debt, including deficiency Judgments and other debt associated with past FHA-insured Mortgages.
If the borrower is found to have a delinquent federal debt through CAIVRS, the Mortgagee must verify the validity and delinquency status of the debt by contacting the creditor agency using the contact phone number and debt reference number reflected in the Borrower’s CAIVRS report.
If the creditor agency confirms that the debt is valid and in delinquent status, then the Borrower is ineligible for an FHA-insured Mortgage until the Borrower resolves the debt with the creditor agency in accordance with the Debt Collection Improvement Act.
The creditor agency that is owed the debt can verify that the debt has been resolved.
The Mortgagee must include documentation from the creditor agency to support the verification and resolution of the debt. The Mortgagee may obtain evidence of resolution by obtaining a clear CAIVRS report. Removal from CAIVRS, however, does not guarantee eligibility for an FHA mortgage.
Generally, a Borrower is not eligible for a new FHA-insured Mortgage if the Borrower had a foreclosure in the three-year period prior to the date of case number assignment.
If the information in CAIVRS about a borrower with an FHA loan is incorrect, FHA will correct the information upon submission to the appropriate FHA Homeownership Center (HOC) of documentation showing the correct information. FHA cannot correct information reported by another government agency.
To locate the FHA Homeownership Center, go to the following website and click on the applicable state: https://www.hud.gov/program_offices/housing/sfh/sfhhocs
For additional information see Handbook 4000.1
II.A.1.b.ii.(A)(10)-(11) available at https://www.hud.gov/program_offices/administration/hudclips/handbooks/hsgh