The Need for HUD to More Fairly Treat Homeowner Claims for Defects in Existing Insured Homes

Gao ID: 101956 April 15, 1977

At the request of Rep. Ralph H. Metcalfe, the Department of Housing and Urban Development's Section 518(b) Homeowner Assistance Program operated by the Chicago Area Office was reviewed. Criteria used to evaluate claim applications for defects in existing insured homes were identified, and the appeals process for the applicants was assessed. Procedures for processing the claims require a determination as to: (1) the eligibility of the claim based on statutory requirements; and (2) the validity of the claim based on inspection results or other applicable criteria. Due to vague criteria, homeowners in the Chicago area who have submitted claims have not been treated consistently in a fair and equitable manner.

Recommendations

Our recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.

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