source:
  type: guide
  id: hud-4000-1-v-a-actions-and-sanctions
  authority: FHA Single Family Housing Policy Handbook 4000.1, Part V — a. Actions
    and Sanctions (09/14/2015)
  description: FHA Single Family Housing Policy Handbook 4000.1, Part V — a. Actions
    and Sanctions (09/14/2015).
  coverage_tier: operative
obligations:
- id: hud-4000-1-v-a-actions-and-sanctions-full
  canonical_id: hud-4000-1-v-a-actions-and-sanctions-full
  section: FHA Single Family Housing Policy Handbook 4000.1, Part V — a. Actions and
    Sanctions (09/14/2015)
  type: do
  tags:
  - regulator-direct
  - fha
  - hud-handbook
  - corpus-expansion
  - tier-operative
  primary_source:
    tier: 1
    authority: FHA Single Family Housing Policy Handbook 4000.1, Part V — a. Actions
      and Sanctions (09/14/2015)
    source_class: hud-handbook
    source_url: https://www.hud.gov/hud-partners/single-family-handbook-4000-1
    snapshot_id: 8c03836f77f317e1
    fetched_at: '2026-05-23T00:28:40Z'
    content_hash: sha256:411430f29b13f9b54a2ebb0e6f6e7087ecd2b90d0da22eb0c8c792eaa2d7d0df
    paragraph_quote: 'a. Actions and Sanctions (09/14/2015) The following actions
      and sanctions may be imposed by the MRB: • a letter of reprimand; • probation;
      • suspension; • withdrawal of FHA approval; and • civil money penalties. The
      MRB may also enter into settlement agreements with noncomplying Mortgagees.
      The following are general descriptions of the types of actions and sanctions
      that may be taken by the MRB and are for informational purposes only. The specific
      requirements for and procedures applicable to these actions are set forth in
      sections 202(c) and 536 of the National Housing Act (12 U.S.C. §§ 1708(c) and
      1735f-14), and Parts 25 and 30 of Title 24 of the Code of Federal Regulations
      (24 CFR Parts 25 and 30). i. Letter of Reprimand The MRB may issue a letter
      of reprimand to inform a Mortgagee of its violation of FHA requirements. A letter
      of reprimand is effective upon receipt of the letter by the Mortgagee. (A) Case
      Status A letter of reprimand has no impact on the Mortgagee’s authority to originate,
      underwrite, or service FHA-insured Mortgages. (B) Duration There is no time
      duration associated with a letter of reprimand. (C) Appeal The Mortgagee has
      no right to appeal a letter of reprimand within HUD. ii. Probation The MRB may
      place a Mortgagee on probation for violation of FHA requirements. The MRB will
      specify the scope, terms, and conditions of the probation, which are designed
      to allow FHA to monitor the Mortgagee and assist FHA with bringing the Mortgagee
      into compliance with FHA regulations. (A) Case Status Unless specified in the
      terms of the probation, a Mortgagee on probation retains its origination, underwriting,
      and servicing authorities, as applicable. V. QUALITY CONTROL, OVERSIGHT, AND
      COMPLIANCE E. Enforcement 4. Mortgagee Review Board Actions and Sanctions Handbook
      4000.1 1744 Last Revised: 11/26/2025 (B) Duration The MRB may place a Mortgagee
      on probation for a period of up to six months. (C) Appeal The Mortgagee has
      the right to appeal a probation action in accordance with the provisions of
      24 CFR Parts 25–26. iii. Suspension Suspension is a temporary measure that is
      applied to a Mortgagee when there is adequate evidence that the interests of
      HUD or the public would not be served by continuing to allow the Mortgagee to
      participate in FHA programs, pending the completion of any investigation, other
      review, or legal or administrative proceedings the Mortgagee is involved in.
      (A) Effective Date If the MRB determines there is adequate evidence that immediate
      action is required to protect the financial interests of HUD or the public,
      the MRB is authorized to suspend a Mortgagee’s FHA approval immediately upon
      issuance of the notice of suspension and without prior issuance of a Notice
      of Violation (NOV) as set forth in 24 CFR § 25.7(d). Any other suspension is
      effective upon the Mortgagee’s receipt of the notice of suspension as set forth
      in 24 CFR § 25.5(d). (B) Case Status During the period of suspension, HUD will
      not endorse any Mortgage originated by the suspended Mortgagee unless it was
      an Approved Mortgage prior to the date of suspension. The Mortgagee must transfer
      all other applications in process to another FHA- approved Mortgagee for completion
      of processing, submission, and endorsement. (C) Duration Suspension is generally
      imposed for a period of six months to one year, but may be extended for an additional
      six months in accordance with the provisions of 24 CFR Part 25. (D) Appeal The
      Mortgagee has the right to appeal a suspension in accordance with the provisions
      of 24 CFR Parts 25–26. V. QUALITY CONTROL, OVERSIGHT, AND COMPLIANCE E. Enforcement
      4. Mortgagee Review Board Actions and Sanctions Handbook 4000.1 1745 Last Revised:
      11/26/2025 iv. Withdrawal of FHA Approval Only the MRB may withdraw a Mortgagee’s
      FHA approval. Withdrawal of FHA approval applies to all offices of the Mortgagee.
      (A) Effective Date If the MRB determines there is adequate evidence that immediate
      action is required to protect the financial interests of HUD or the public,
      the MRB is authorized to withdraw a Mortgagee’s FHA approval immediately; in
      this case, the withdrawal is effective upon the Mortgagee’s receipt of the notice
      of withdrawal. Any other withdrawal is effective upon either: • the expiration
      of the 30-Day appeal period, if the Mortgagee does not request a hearing; or
      • the receipt of the Administrative Law Judge’s final decision, if the Mortgagee
      does request a hearing within the 30-Day appeal period. (B) Case Status HUD
      will not endorse any Mortgage originated by the withdrawn Mortgagee unless it
      was an Approved Mortgage prior to the date of withdrawal. The withdrawn Mortgagee
      must transfer its servicing portfolio to another FHA- approved Mortgagee. See
      transfers of servicing and sales of Mortgages. Withdrawn FHA approval means
      that the Mortgagee may not originate, underwrite, service, or purchase any FHA-insured
      Mortgages. (C) Duration The MRB’s withdrawal of a Mortgagee’s FHA approval will
      be for a reasonable, specified period of time, but not less than one year. The
      MRB may permanently withdraw a Mortgagee’s FHA approval if it finds the Mortgagee’s
      violations to be egregious or willful. A withdrawn Mortgagee’s approval is not
      reinstated at the end of the period of withdrawal. The Mortgagee may re-apply
      for FHA approval after the period of withdrawal has expired. (D) Appeal The
      Mortgagee has the right to appeal a withdrawal of its FHA approval by the MRB
      in accordance with the provisions of 24 CFR Parts 25–26. V. QUALITY CONTROL,
      OVERSIGHT, AND COMPLIANCE E. Enforcement 4. Mortgagee Review Board Actions and
      Sanctions Handbook 4000.1 1746 Last Revised: 11/26/2025 v. Civil Money Penalties
      The MRB may impose civil money penalties against any FHA-approved Mortgagee
      who knowingly and materially violates FHA requirements as set forth in 24 CFR
      § 30.35. (A) Complaint If the MRB elects to seek civil money penalties against
      a Mortgagee, HUD will file a complaint to initiate legal action. A civil money
      penalty may be imposed against a Mortgagee in addition to any other administrative
      action taken by the MRB. (B) Maximum Civil Money Penalties The MRB is authorized
      to impose a civil money penalty, in accordance with the provisions of 24 CFR
      Part 30, against a party that knowingly and materially violates FHA program
      regulations or requirements. A civil money penalty may be imposed with respect
      to each insured Mortgage or other separate occurrence of a violation up to the
      maximum permitted under Part 30. (C) Mitigating and Aggravating Factors In determining
      the amount of a civil money penalty, the MRB will consider the following factors:
      • the gravity of the offense; • the Mortgagee’s history of prior offenses; •
      the Mortgagee’s ability to pay the penalty; • the injury to the public; • the
      benefits received by the violator; • the extent of potential benefit to other
      persons; • deterrence of future violations; and • the degree of the violator’s
      culpability. vi. Settlement Agreements The MRB is authorized to enter into settlement
      agreements with noncomplying Mortgagees at any time in order to resolve grounds
      for an administrative sanction or civil money penalty, as set forth in 12 U.S.C.
      § 1708(c)(3)(E) and 24 CFR § 25.5(a). Failure by the Mortgagee to comply with
      the terms of a settlement agreement may result in a suspension or withdrawal
      of the Mortgagee’s FHA approval.'
  judgment: false
