Just like with so many other financial institutions, there is a chance that you may be owed money for an existing or prior mortgage that you have. One of those areas is if you have a mortgage and you took out an FHA homeowners loan. To find out if you’re eligible, you can reach out to the Department of Housing and Urban Development (HUD).
When a homeowner has sold a house that was insured by an FHA mortgage, they are entitled to unclaimed HUD refunds that can be worth hundreds of millions of dollars. These unclaimed assets won’t be listed in a state property database anywhere because they’ll be issued by the HUD. But if you got your mortgage with an FHA loan, you could be eligible for money returned to you after you sell your home and move.
If you want to know if you qualify for an FHA mortgage refund or have unclaimed assets if you took out an FHA loan, you would need to fit the following criteria:
- You took out your loan after September 1, 1983.
- You paid an upfront mortgage insurance premium at the closing sale.
- You did not default on your mortgage payments at any point.
- If you originated your loan before September 1, 1983.
- If you paid on your loan for more than seven years.
- If you had your FHA insurance terminated before November 5, 1990.
There are also exceptions where you might not be able to qualify for an FHA insured loan refund.
- Assumptions: When an FHA insured loan is assumed, the insurance will remain in full force, meaning that the seller receives no refund. The owners of the property at the time the insurance is terminated will be entitled to a refund.
- FHA to FHA refinances: When an FHA loan is refinanced, the refund from the old premium could be applied toward the upfront premium that is required for the new loan.
- Claims: When a mortgage company submits a claim to HUD for insurance benefits, there is no refund due to the homeowner.
- Statute of limitations: HUD is not liable for a share that remains unclaimed for six years from the date a notification was first sent to the last known address of the previous owner.
To find out if a refund will be determined, you’ll need to consider the timelines. For FHA loans that were issued with a closing date prior to January 1, 2001 and endorsed before December 8, 2004, no refund will be due to the homeowner after the end of the seventh year of the insurance policy. And for any FHA loans that were issued on or after January 1, 2001 and endorsed before December 8, 2004, there will be no refund due to the homeowner after the fifth year of holding the insurance policy.
Refunds will be processed when the mortgage company tells HUD of the termination of the FHA mortgage insurance for your loan. If you’re eligible for a refund, HUD will either request that the Department of Treasury issues a check to your directly or send you an application to fill out to qualify.