Work on the nation's "HUD homes” hums in a nondescript office building in southwest Oklahoma City.
For homes headed out of foreclosure and into the hands of the U.S. Department of Housing and Urban Development — anywhere in the United States — all bureaucratic roads lead through the building, where 75 people work 12 hours a day, five days a week, processing them.
"HUD homes,” they're called — for their hopeful seller: HUD.
The Federal Housing Administration, an arm of HUD, insures millions of mortgage loans. When homeowners default on those loans, the homes go into foreclosure, HUD pays off the loans and takes possession of the houses. Before HUD can try to market them, they have to be processed to make sure that the lenders and loan servicers have conveyed the properties to HUD in acceptable condition.
And it all happens at 4400 Will Rogers Parkway, Suite 300, where Michaelson, Connor & Boul Inc., based in Huntington Beach, Calif., has sorted through mortgage messes since March.
HUD contracted with the firm to act as mortgagee compliance manager, under supervision of HUD's National Servicing Center here.
"This new contract is part of FHA's continuing effort to reduce risk, increase return, and improve efficiency in the resale of its inventory of foreclosed property,” said HUD Deputy Assistant Secretary Vicki Bott. "It is critically important that FHA recaptures as much of our claims through the eventual sale of these properties and this compliance management firm will help us do that.”
HUD has subcontracted foreclosed inventory processing to the private sector since 1999. However, this is the first time a single firm has taken on all the work. HUD said it contracted with Michaelson, Connor & Boul "to streamline its operations, capitalize on the expertise of potential vendors and provide flexibility in a changing environment.”