- filing for record the deed to the Secretary of HUD; and
- filing form HUD-27011 in FHA Connection (FHAC) for claim processing and payment.
HUD will presume that any damage discovered during HUD's first inspection of the Property after conveyance occurred while the Mortgagee had possession, unless the Mortgagee is able to provide evidence to the contrary.
Without the express written approval of the Mortgagee Compliance Manager (MCM), the Mortgagee must not incur expenses for Preservation and Protection (P&P) of the Property or for eviction of the occupant on or after the date the deed is filed for record.
HUD will not reimburse P&P or property-related expenses incurred after the deed has been recorded in HUD’s name, other than payment of certain utility bills or Homeowners’ Association (HOA) payments.
The Mortgagee must request the hazard insurance be canceled as of the date the deed is filed for record. The Mortgagee may calculate the amount of the return premium due on a short-rate basis.
HUD considers a Property conveyed by the Mortgagee to HUD when:
- the Mortgagee has deeded the Property to HUD; and
- HUD accepts conveyance of the Property, as evidenced by the payment of Part A of the claim from HUD to the Mortgagee. For suspended claims, the Mortgagee remains responsible for the Property, and any loss or damage thereto, notwithstanding the filing of the deed to the Secretary for record, and such responsibility is retained by the Mortgagee until HUD regulations have been fully complied with.
Additional questions may be directed to the HUD National Servicing Center at (877) 622-8525.
For policy information see Handbook 4000.1 Section III.A.2.t.vi. & viii. available at https://www.hud.gov/program_offices/administration/hudclips/handbooks/hsgh