Things have changed a bit since 1980. Yet the Federal Housing Administration (FHA) is still relying on systems that are more than 40 years old.
In December 2019, Brian D. Montgomery, Assistant Secretary for Housing and Federal Housing Commissioner, U.S. Department of Housing and Urban Development told a subcommittee of the House Financial Services Committee:
“A critical concern I shared with Congress during my first time serving as Commissioner, and anyone that would listen in the years that followed, is the need to radically modernize FHA’s information technology structure. FHA’s single-family business currently runs off 15 different systems, some of which are more than 40 years old. FHA’s technological backbone uses an antiquated programming language developed more than a half century ago. Frequent system failures and other technology service breaks result in costly delays, increase FHA risk exposure, as well as that of FHA-approved lenders and other program participants.”
The American taxpayer should be pleased that both the FHA and Congress recognize the need to update this outdated system.
Congress appropriated funds to start modernizing FHA’s single-family technology systems. Montgomery explained, “HUD formed an extremely qualified and competent FHA IT Modernization project team that started by gathering business requirements for every element of the loan life cycle from application and origination through claims processing. Working with single family staff at headquarters and in the field, this team has an ultimate objective of fully digitizing FHA’s single-family loan cycle.”
Our team at IGH is pleased to be leading this modernization project along with our partners at incapsulate and Pyramid Systems, Inc.
FHA recently gave an update on the first part of the modernization process. The FHA’s new Supplemental Claims system is now online. It’s built using the latest in technology on a flexible, cloud-based platform. It’s a system you’d expect in 2020.
This system allows mortgage servicers to electronically submit data. As the FHA rightly points out, this “eliminates paper-based submissions,” “improves accuracy and efficiency” and “expands access to data and analytics.”
It’s all a win-win-win.
We look forward to future phases of this multi-year modernization project as they roll-out. In the meantime, we’re pleased to be playing a role in transforming government to work more efficiently.
Learn more about FHA’s Modernization in this video from HUD: