Housing Bubble
Cendant issues response to Wall Street Journal Story
Cendant Corporation yesterday issued a response to an article in the Wall Street Journal regarding loans submitted to the Federal Housing Administration (FHA).
The Department of Housing and Urban Development (HUD) recently conducted an audit into FHA loans and determined, together with Cendant, that approximately 1,000 loans submitted to FHA were improperly processed and submitted. This was attributed to unprecedented volume. The process has been subsequently corrected. The issue is limited to approximately 1,000 out of 786,000 loans that the company serviced as of December 31, 2002.
HUD did not assess any penalties against the Company. The Company has agreed to indemnify the FHA for any potential loss on this small number of loans. The potential amount is immaterial to both Cendant and its mortgage company operations and has been fully reserved. HUD indicated that it was impressed by the corrective actions taken by the Company.
Cendant Corporation is primarily a provider of travel and residential real estate services. With approximately 90,000 employees, New York City-based Cendant provides these services to businesses and consumers in over 100 countries.
Source: Cendant Corporation
e-mail:sites@housing-bubble.com