MBA to HUD: Publish notices about challenges with real estate inspection protocols

By Housing News

The


Mortgage
Bankers
Association

(MBA)
on
Tuesday
announced
its
submission
of
a
letter
to
the


U.S.
Department
of
Housing
and
Urban
Development

(HUD),
which
urges
the
department
to
avoid
reprimanding
mortgage

servicers

for
compliance
lapses
with
the
new
National
Standards
for
the
Physical
Inspection
of
Real
Estate
(NSPIRE)
system
until
it
is
“fully
accessible
and
usable
to
each
participant.”

The
letter
is
addressed
to
Ryan
LaFollette,
acting
deputy
assistant
secretary
in
the
Real
Estate
Assessment
Center
(REAC)
at
HUD.
MBA
CEO

Bob
Broeksmit

explained
that
until
the
new
NSPIRE
system
is
fully
accessible
and
usable
for
all
users,
servicers
should
not
be
held
accountable
for
any
compliance
lapses
tied
to
the
standards.

“Servicers
of


Federal
Housing
Administration

(FHA)
loans
are
required
to
conduct
inspections
in
a
timely
fashion,
and
any
deficiencies
are
corrected
per
the
Real
Estate
Assessment
Center
protocol,”
Broeksmit
said
in
the
letter.
“However,
accessibility
issues
as
well
as
system
bugs
that
still
must
be
worked
through
in
the
new
NSPIRE
system
are
preventing
these
activities.”

NSPIRE
was
implemented
by
REAC
in
October
2023,
but
MBA
has
received
reports
from
servicers
explaining
the
challenges
they’ve
encountered
when
attempting
to
use
it,
Broeksmit
said.

“[S]ervicers
have
experienced
difficulties
logging
into
the
system,
scheduling
inspections,
maintaining
inspection
schedules
and
reviewing
reports,”

he
explained
.
“Problems
with
the
software
and
incorrect
data
have
left
a
number
of
servicers
unable
to
access
the
system.
For
those
inspections
that
are
completed,
many
servicers
are
unable
to
access
the
reports,
with
no
ability
to
follow
up
on
any
potential
necessary
repairs.”

Servicers
have
expressed
concern
to
MBA
about
being
held
accountable
for
compliance
lapses,
despite
the
impediments
in
accessing
NSPIRE,
the
letter
read.

“MBA
urges
HUD
to
provide
a
written
assurance
to
the
FHA
loan
servicing
community
that
they
will
not
be
held
accountable
for
NSPIRE
requirements
until
the
system
is
fully
operational
and
accessible
to
each
participant,”
the
letter
stated.
“Servicers
are
doing
their
best
to
work
with
the
new
system,
but
NSPIRE
problems
must
be
solved
to
enable
servicers
to
comply
with
its
requirements.
We
urge
you
to
make
this
clear
though
an
official
notice
or
memorandum.”

According
to
a

historical
rundown

of
the
protocol
compiled
by

The
Inspection
Group
,
a
provider
of
inspection
services
to
public
housing
agencies
and
affordable
housing
management
companies,
REAC
was
established
in
the
late
1990s
and
was
the
first
standardized
process
for
the
inspection
of
federally
subsidized
properties.

Clearer
guidelines
and
training
programs
emerged
in
the
early
2000s
for
property
inspectors,
and
the
following
decade
saw
additional
technology
regularly
employed
by
inspectors
to
accomplish
their
tasks.

In
2020,
NSPIRE
was
launched
by
REAC
as
a
pilot
program
designed
to
address
known
challenges
in
the
inspection
process.
A

final
rule
was
published

in
May
2023
that
requires
inspectors
to
use
NSPIRE
protocols.

 

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