FHA will document the results of each review in LRS and will use its Single Family Housing Policy Handbook 4000.1, Appendix 7.0 – FHA Defect Taxonomy to identify and capture detailed information about any unacceptable Findings related to compliance with FHA underwriting requirements. For each unacceptable Finding in the LRS, FHA will request a response and specify the allowable remedy(s) that are required from the Mortgagee. The Mortgagee must resolve each unacceptable Finding using the functions provided in LRS.
For additional information see:
- Handbook 4000.1 Section V.C.2.b; V.C.3.b and Appendix 7.0 – FHA Defect Taxonomy, available at: https://www.hud.gov/program_offices/administration/hudclips/handbooks/hsgh,
- LRS Information Page: https://www.hud.gov/program_offices/housing/sfh/lender/loan_review_system
- LRS User Manual: https://www.hud.gov/sites/dfiles/SFH/documents/LRSUserManual.pdf