Monday, May 24, 2010

query: what does a FHA spot audit cover

It's been awhile since my last FHA spot audit but I've been through a few over the years. 

The first was the most memorable.  It was in 1978 and I was a young originator.  The FHA auditor walked into our office, unannounced, identified himself and asked for 25 randomly selected files, some closed, most in process.  After he reviewed the files he walked over to my desk for a chat.  He explained that the FHA will criminally prosecute borrowers and lenders who act outside of the rules and that I sure didn't want to wear stripes.  I don't know if FHA auditors still have chats like that with originators but I think it's a good idea!  ;)

I recall another FHA spot audit in the late 80s when Hubby and I had our own shop.  In addition to auditing randomly selected files, I recall that he also checked our signage.

I'm sure they checked more than that but I can't remember.  If you are in the mortgage lending business and your house is in order. you should not be afraid of any auditor.  Run a clean shop and you can sleep well.  None of us look good in whatever the latest is in prison garb.

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