Form HUD-2741 Instructions for Applications for Insuance Benefits

Fiscal Instructions for Filing for
Multifamily Insurance Benefits

U.S. Department of Housing and
Urban Development
Office of Housing
Federal Housing Commissioner

OMB Approval # 2502-0418
(exp. 06/30/2021)

All conveyances of property and assignments of mortgages in exchange for the benefits of HUD mortgage insurance must name, as
grantee, the “Secretary of Housing and Urban Development of Washington, D.C., his/her successors and assigns.”
Multifamily Insurance Claim Processing Steps Overview
I.
II.
III.
IV.
V.
VI.
VII.
VIII.
I.

Time Requirements
Forms Submitted Prior to Assignment or
Conveyance
Assignment of Mortgage or Conveyance of Property
Method of Payment
Partial Settlement
Determining the Date of Default
Fiscal Data Submission
Legal Clearance

IX.
X.
XI.
XII.
XIII.
XIV.
XV.

Time Requirements
A. Assignment of Mortgage or Conveyance of Property
1. HUD Regulations at 24 CFR Part 200, Subpart B,
require multifamily mortgagees to report mortgage
delinquencies, defaults, reinstatements, assignment
elections, withdrawals of assignment elections,
and related mortgage information to HUD
electronically through the Internet. HUD
developed the Multifamily Delinquency and
Default Reporting (MDDR) System to assist
mortgagees in satisfying these requirements.
2. A mortgage is considered delinquent when the
payment is not received by the fifteenth (15th) day
of the month due. Mortgagees must report the
mortgage delinquency through the MDDR system
between the sixteenth (16th) and twentieth (20th)
day of the month due.
3. Within sixty (60) days after the date of default, the
mortgagee must file a Notice of Default through
the MDDR system as required by HUD
Regulations at 24 CFR 207.256.
4. Within forty-five (45) days after the date that the
mortgagee becomes eligible to file for insurance
benefits (see 24 CFR 207.255 (c)), the mortgagee
must provide the Commissioner notice of its
intention to file an insurance claim. The notice
must include the mortgagee’s election either to
assign the mortgage to the Commissioner, or to
acquire and convey title to the Commissioner per
HUD Regulations at 24 CFR 207.258(a). The
Notice of Election must be submitted
electronically to HUD through the MDDR system.
HUD Headquarters’ Office of Asset Management
(OAM) will approve/acknowledge the Notice of
Election to Assign.
5. For the purpose of determining a date of default,
see definition in attached glossary for date of
default. Where there has been a rolling default,
see definition of rolling default in the MDDR Best
Page 1 of 14

Final Claim Settlement
Supplemental Claims
Insurance Benefits Under Section 236 with Interest
Reduction Payments (IRP)
Insurance Benefits Under Section 221(g)(4)
Glossary of Terms and Acronyms
Contact Points, Addresses, Phone and Fax Numbers
Check List for Filing Claims for Insurance Benefits

Practices Guide for determining the date of
default.
B. Assignment of Mortgage
1. The Mortgagee must file its application for
insurance benefits per HUD Regulations at 24
CFR 207.258(b), as further described in
Instruction II, and file for record the assignment of
mortgage within thirty (30) days after the date that
HUD sends the mortgagee an Election to Assign
Approval (“record by”) letter through the MDDR
system. The application must be delivered to HUD
no later than the time of delivery of the fax of the
assignment information described as follows in
item 2.
2. On the day the assignment is filed for record, the
mortgagee must fax the assignment information set
forth in Instruction III to HUD per HUD
Regulations at 24 CFR 207.258(b)(1).
3. Within forty-five (45) days after filing the
assignment for record to HUD, the mortgagee
must submit the Fiscal Data to HUD, Multifamily
Claims Branch (MFCB).
4. Separately, within forty-five (45) days of the filing
for record of the assignment to HUD; the
mortgagee must submit the documents required for
legal clearance to the Office of the General
Counsel (OGC).
C. Conveyance of Property
1. The requirements for Conveyances of Property are
similar to those above for Assignments of
Mortgages. However, the time frames for
conveyances of the title differ, depending upon
whether the mortgagee secures the title by
foreclosure or by means other than foreclosure (see
24 CFR 207.258(c)(2) or (3)).
2. Within forty-five (45) days following the date that
the mortgagee becomes eligible for insurance
benefits (see 24 CFR 207.255 (c)), the mortgagee
must notify the Secretary of its election to convey
as required by HUD Regulations at 24 CFR
ref. Handbook 4350.1

form HUD-2741 (04/10)

207.258. The Notice of Election to Convey must
be filed electronically through the MDDR system.
3. Within thirty (30) days after the date of the filing
of the Notice of the Election to Convey, the
mortgagee must take one of the following actions
per HUD Regulations at 24 CFR 207.258(c)(2) or
(3):
a. The mortgagee may commence foreclosure
proceedings (24 CFR 207.258(c)(2)). Within
thirty (30) days of the date that the mortgagee
institutes foreclosure proceedings, the
mortgagee shall give written notice to the
Commissioner per HUD Regulations at 24
CFR 207.258(4).
b. Alternatively, the mortgagee may, with the
approval of HUD, acquire possession of and
title to the property by means other than
foreclosure per HUD Regulations at 24 CFR
207.258(3).
4. Within thirty (30) days following the mortgagee’s
acquisition of title to the property, either by
foreclosure or deed, the mortgagee must have the
deed recorded in the Secretary’s name.
5. On the date the deed to the Secretary is filed for
record, the mortgagee must file its application for
insurance and fax the conveyance information set
forth in Instruction III to HUD as required by
HUD Regulations at 24 CFR 207.258(c)(5).
6. Within forty-five (45) days after the date that the
instrument of conveyance is recorded, the
mortgagee must submit the fiscal data to MFCB.
7. Separately, within forty-five (45) days of the date
that the instrument of conveyance is recorded, the
documents required for legal clearance must be
submitted to the OGC. (See Instruction VIII.)
D. Extension of Time Requirements for Assigned
Mortgages and Conveyed Projects:
1. If for any reason beyond its control, the mortgagee
is unable to comply with the above requirements,
the mortgagee must request an extension of time
on or prior to the deadline date. If an extension is
granted, and if necessary actions are taken within
such extended time, accrued interest included in
the cash payment will be computed to the date of
settlement.
a. A request for an extension on the Notice of
the Election to Assign or Convey must be
requested electronically through the MDDR
system.
i.
These requests are not automatically
approved.
ii.
HUD’s Multifamily Hub/Program
Center Offices will respond to these
requests by email or letter in a
manner so that the response will be
received at least one business day
prior to the deadline date.
iii.
As a general rule, there must be a
plan in progress that will bring the
mortgage current and avoid an
insurance claim.

b.

c.

d.

II.

If an extension is required on the recordation
of assignment of the mortgage, the request
must be submitted electronically through the
MDDR system.
i.
Please note that requests for
extensions on the recordation
assignment are reviewed by OAM
staff and are not automatically
approved.
ii.
Decisions to approve requests for
extensions will be made on a case by
case basis. As a general rule, if HUD
has not caused the delay in the
recordation of assignment, an
extension will not be granted.
iii.
OAM will respond to the extension
request by letter or email.
To request an extension of time to submit the
fiscal data, the mortgagee must submit its
request to MFCB by fax or email.
i.
For fiscal data requirements, no more
than two (2) fifteen (15) day
extensions of time may be granted.
A request for an extension of time to submit
the required legal documents must be
submitted to OGC.
i.
Please review the legal instructions,
which can be obtained electronically
through the MDDR system.
ii.
For legal clearance, only one fifteen
(15) day extension may be granted.

Forms Submitted Prior to Assignment or Conveyance
A. The mortgagee must complete and submit the
following three forms to MFCB:
1. Form HUD-2747, Mortgagee’s Application for
Insurance Benefits;
2. Form HUD-2537, Mortgagee’s Application for
Partial Settlement, and
3. Form HUD-1044-D, Multifamily Insurance
Benefit Claim, Payment Information in Support of
Claim.
B. For assignment of a mortgage, the mortgagee must
submit the forms within thirty days after the date of
the Election to Assign Approval Letter, and prior to,
or at, the time of assignment as provided in
Instruction I.
C. For conveyance of property, these forms must be
submitted on the date the instrument of conveyance is
filed for record.
D. When the mortgagee has the option, based on the
Section of the Act, to elect payment in FHA
debentures, the mortgagee must deliver written
notification to HUD of its election for debentures
along with the three forms identified above.
E. Execute and submit an original and one copy of these
forms (only one copy is required if delivery is by fax
or e-mail, with an original and one copy to follow) to
HUD, Multifamily Claims Branch.

Page 2 of 14 ref. Handbook 4350.1 form HUD-2741 (04/10)

III.

On the date the assignment or deed is filed for record, the
mortgagee must notify MFCB of the assignment or
conveyance, as applicable, by fax that includes the
information below to the Chief, MFCB at (202) 619-8259.
A. The notice must contain the following information:
1. All of the information required in Exhibit A of the
election approval/acknowledgement e-mail letter;
2. A certification that the mortgagee or servicer has
completed and submitted:
a. Form HUD-2747;
b. Form HUD-2537;
c. Form HUD-1044-D, and
3. A statement as to whether there is, or is not, a
Debenture Lock Agreement.
B. After the assignment of the mortgage or conveyance
of the deed to the Secretary has been filed for record,
any taxes that will become due within forty-five (45)
days must be paid by the mortgagee and included in
the claim for insurance benefits. The amount of
penalties paid on delinquent taxes will be disallowed.
C. Any tax bills that will become due after the forty-fifth
(45th) day following the date of assignment must be
forwarded to HUD, Multifamily Notes Servicing.
D. For multifamily assigned mortgage claims paid in
debentures, all escrow deposits, reserve for
replacements funds, undisbursed mortgage proceeds,
any undisbursed balance under a letter of credit, and
other monies held by the mortgagee for the account of
the mortgagor must be remitted to HUD on or before
the date that the mortgagee delivers to HUD the fiscal
submission in Instruction VII. Send remittances to
HUD, Multifamily Mortgage Notes.
E. All escrow balances required by HUD, the mortgagee,
or any other entity, and any other payments on behalf
of the mortgagor that the mortgagee receives
subsequent to the assignment or conveyance must be
made payable to HUD and forwarded to HUD,
Multifamily Mortgage Notes.
F. For all remittances, a cover letter stating the amount
of the check, nature of the payment, project number
and name must be submitted with the payment sent to
HUD, Multifamily Mortgage Notes. At the same time,
fax a copy of the cover letter to MFCB. The fax
number is (202) 619-8259.
IV.

4.

All other multifamily mortgages endorsed under
another Section of Titles II or XI pursuant to
Section 223(e).
C. Where settlement is made in debentures, the
debentures will:
1. Be issued in the amount of the partial settlement
or, if in final settlement, the net amount of the
claim less the amount of the partial settlement
previously issued;
2. Generally be issued as of the date of default;
3. Be issued as a book entry, and
4. Bear interest from the date of default, payable
semi-annually for twenty (20) years, on the first
day of January and the first day of July of each
year at the higher of the rate in effect as of the date
that HUD’s firm commitment was issued or as of
the date of the initial endorsement of the mortgage.

Assignment of Mortgage or Conveyance of Property

Method of Payment
A. Settlement will be made in cash or in debentures as
determined by the Section of the Act under which the
mortgage is insured.
B. The exceptions to the foregoing are with respect to the
following claims which will be paid in cash, unless
the mortgagee requests debentures:
1. Sections 220, 221, and 233 endorsed on or after
July 7, 1961;
2. Sections 235(j)(1), 236; Section 241 loans made in
connection with any of the foregoing and endorsed
on or after July 15, 1978;
3. Title X mortgages endorsed on or after March 1,
1980, and

V.

Partial Settlement
A. HUD makes a partial settlement on cash claims filed
for insurance benefits no later than three (3) business
days from the date that HUD receives the fax of the
assignment or conveyance.
B. HUD pays up to ninety percent (90%) of the unpaid
principal balance (UPB), plus accrued interest at the
debenture rate from the date of default to the date of
settlement, if the mortgage is finally endorsed.
C. HUD pays up to seventy percent (70%) of the UPB,
plus accrued interest at the debenture rate from the
date of default to the date of settlement, if the project
is not finally endorsed.
D. If the aggregate escrow amounts reported in block 5
of form HUD-2537 equals ten percent (10%) or more
of the UPB, HUD will deduct the escrow amount
from the UPB before computing the partial settlement.
E. HUD will include accrued interest in the partial
settlement amount.
1. HUD will compute the accrued interest based on
the amount of the unpaid principal balance.
2. HUD will compute accrued interest at the
debenture rate from the date of default.
3. HUD will compute the accrued interest to the date
of settlement if the mortgagee takes the required
actions within the time set forth in the HUD
regulations or within such further times if HUD
has granted written extensions.
4. If the mortgagee fails to take the required actions
within the time limits set forth in the regulations,
or as extended in writing, HUD will compute the
interest to the final date the action should have
occurred under the HUD regulations.

Page 3 of 14 ref. Handbook 4350.1 form HUD-2741 (04/10)

VI.

E. See Instruction XI for determining the date of default
under certain circumstances for Section 236
mortgages.

Determining the Date of Default
The date of default must be determined accurately and in
accordance with the applicable regulations.
A. The date of default for the purpose of claim settlement
is the due date of the defaulted payment as provided
in HUD Regulations at 24 CFR 207.255(d).
B. The date of default may be advanced by crediting all
complete monthly payments received prior to election
(to assign the mortgage or to convey the property) to
the first unpaid installment in the order specified in
the mortgage; that is, to escrow deposits, interest and
principal, then to the reserve for replacements due
concurrently therewith and then to the succeeding
required monthly payments in the same order.
C. Amounts received prior to election which do not
cover a full monthly installment and all amounts
received after the election to receive insurance
benefits must be applied as a reduction of the claim
settlement in accordance with HUD regulations at 24
CFR 207.259(b).
1. Note: The above order of application applies
specifically and solely to determining the date of
default for the purpose of claim settlement.
2. Accordingly, any debentures issued will be dated
as of the date of default as so determined, or the
interest adjustment will be computed from that
date if the settlement is in cash.
D. Covenant Default
1. A covenant default is a non-monetary default of a
requirement or prohibition of the Regulatory
Agreement or the mortgage.
a. For a covenant default of the mortgage, the
lender has the authority to demand payment in
full, (accelerate the mortgage). If the borrower
does not correct the deficiency within the
thirty (30) day cure period, the lender will
submit an “Initiate Covenant Default” in the
MDDR system. Such a loan is said to be in
covenant default.
b. HUD may declare a covenant default under
the Regulatory Agreement for certain acts. For
instance, if the borrower fails to conform to
the HUD requirements in the Regulatory
Agreement to maintain the property in good
repair, HUD may direct the lender in writing
to call the loan due, and accelerate, even if
payments have been made as agreed under the
note and the mortgage.
2. In a covenant default, the default date is the date
the mortgagee sent the acceleration letter to the
mortgagor informing him or her of the regulatory
or covenant violation.
3. The mortgagee must provide a copy of the
following letters with the fiscal package when
submitting its claims; the HUD acceleration letter
sent by the mortgagee to the mortgagor, and any
HUD acceleration letter or approval to accelerate
sent to the mortgagee.

VII.

Fiscal Data Submission
Submit fiscal data on form HUD-2742, Fiscal Data in
Support of Claim for Insurance Benefits.
A. The fiscal data instructions and forms used in
computing the claim for insurance benefits are
available on HUD’s web site at www.HUD.gov and in
the MDDR system.
B. Submit an original and one copy of the completed
fiscal data package to the HUD, Multifamily Claims
Branch.
1. For mortgages that are bond financed, the
mortgagee must submit a copy of the bond trust
indenture with the fiscal package.
2. In addition, include an informational letter that
identifies by page number where the following
information is located in the indenture:
a. Type of bond;
b. Final balance;
c. Disposition instructions and beneficiaries, and
d. Trustee addresses.
3. For mortgages that have a Debenture Lock
Agreement, the mortgagee must also submit a
copy of the Debenture Lock Agreement and the
Asset Parity Table with the fiscal package.
C. To prepare the form HUD-2742, first complete the
schedules as appropriate:
1. Form HUD-2744-A, Allocation of Mortgagee’s
Receipts and Disbursements, Schedule A;
2. Form HUD-2744-B, Mortgagee’s Report of
Project Collections, Schedule B;
3.

D.
E.

F.

G.

Form HUD-2744-C, Mortgagee’s Report of
Project Disbursements, Schedule C;
4. Form HUD-2744-D, Mortgagee’s Report of Other
Disbursements, Schedule D;
5. Form HUD-2744-E, Mortgagee’s Report of
Special Escrows, Schedule E, and
6. Form HUD-434, Statement of Taxes.
Complete Schedules A and E for all claims.
Complete Schedules B and C only in those instances
where the mortgagee, either directly, or through a
servicer or the mortgagor, has had control of the
project property and is, therefore, accountable for the
collection of rents and payments of operating
expenses.
Complete Schedule D for conveyance disbursements
not covered by Schedules B and C and for completion
and preservation expenses meeting 24 CFR
207.259(b)(1)(ii).
Submit the appropriate schedules and form HUD2742, Fiscal Data in Support of Claim for Insurance
Benefits, in an original and one (1) copy.

Page 4 of 14 ref. Handbook 4350.1 form HUD-2741 (04/10)

1.

Note: Where a receiver has operated the property
pursuant to a Court Order, the mortgagee is not
considered to be in control of the property during
the period of such receivership, therefore,
Schedules B and C are not required for that period.
However, the mortgagee must furnish copies of the
receiver’s accounting which must include copies
of the following:
a. Court Order appointing the Receiver;
b. The Receiver’s report(s) to the Court;
c. Court Order(s) approving the Receiver’s
Accounting, and
d. The Court Order discharging the Receiver,
fixing fees and cancelling the receiver’s bond.
2. The mortgagee must also show the receiver’s net
income in column 12 of Schedule A and transfer it
to item ‘g’ on form HUD-2742.
H. Preparation of form HUD-2744-A, Allocation of
Mortgage Receipts and Disbursements, Schedule A
The period covered by this schedule begins with
the date the claimant became the mortgagee.
Schedule A shows only receipts and disbursements
from the borrower, without reflecting advance
activity of mortgagee. Report all transactions in
chronological order.
1. If the claimant was the mortgagee during the
construction period, show the dates of advances of
mortgage proceeds in column (1), and the amounts
of the advances in parentheses in columns 2 and 9.
Interest collections during this period must be
shown with the dates received in column 1 and the
amounts received in columns 2 and 8. In the event
of a participation agreement, the full amount of the
advances made and/or interest collected must be
shown rather than the amount of the participant’s
share. Enter due date(s) for advances and interest
received in column 3.
2. If the mortgage was acquired by the claimant from
another mortgagee after the construction period,
show the date acquired in column 1 and show the
unpaid principal balance in parentheses in columns
2 and 9. Show any accrued interest purchased in
parentheses in columns 2 and 8. Give a full
explanation if there are more than three (3)
business days between the date the mortgagee
acquired the mortgage and the date the accounting
begins.
3. Escrow funds on deposit to the mortgagor’s credit
at the date of acquisition of the mortgage by the
claimant must be shown on the line following the
entry recording the acquisition of the mortgage.
Show in column 1 the date, in column 2 the total
funds, in columns 4, 5, 6, 7 and 10 the amounts, if
any, to the mortgagor’s credit for each item.
Amounts in column 7 must be identified in column
11.
4. All payments made by the mortgagor which are
received prior to the date of election to assign the
mortgage or convey the property must be shown in
columns 1 through 10 with the exception of
incomplete payments received after default.
5. Show the date of payment in column 1, the total

6.

7.

amount received on that date in column 2 and the
date or dates due in column 3. If the payment is
made to cover amounts due on different dates, use
a separate line, starting with column 3, for the
amounts applicable to each date. In columns 4
through 10, show how the total amount received
was applied. Attention is called to the fact that
columns 4 through 9 appear on this schedule in the
order in which the standard form of mortgage or
other credit instrument requires the amounts
received to be applied.
To avoid the necessity of transcribing unnecessary
detail with respect to mortgage payments received
more than three (3) years preceding the date of
default, which are in the same amount each month,
and where the monthly allocation to the individual
escrow accounts for mortgage insurance
premiums, taxes, and hazard insurance premiums
remain constant, it is permissible to show a lump
sum entry for all such like payments received
consecutively.
a. For example, if ten consecutive monthly
payments were received, each in the same
amount and with exactly the same allocations
to escrow, show in column 2 “10 payments @
$_______________ ”, on the next line show
in column 2 the total of the ten payments and
in column 3 show the inclusive dates the
payments were due, as for example, “1/1 10/1” and show in columns 4, 5, 6, 8, 9 and 10
the total allocations for the ten monthly
installments.
b. Show disbursements for the period covered by
such lump sum allocation separately and in
chronological order immediately following the
lump sum entry for any period. See item
number 10 of these instructions for detailed
information on disbursements. Since it is
necessary that individual entries for each
separate payment be shown on Schedule A for
all mortgage payments which are received for
the years prior to default, it will not be
possible to show lump sum allocations unless
the mortgage has been held by the claimant
for more than three (3) years.
c. Copies of the payment record ledger must be
submitted showing in detail all transactions
since the claimant became the mortgagee.
Reporting hazard insurance proceeds:
a. If you, as the mortgagee, receive hazard
insurance proceeds (for damages due to fire,
floods, etc.) prior to assignment, follow the
instructions of OAM to apply the proceeds to
the debt (column 9), or to the repair or
reconstruction of the premises as prescribed in
the Deed of Trust or mortgage. If you do not
apply the proceeds to the debt, report the
receipt of proceeds and their subsequent
release in column 7.
b. If you receive hazard insurance proceeds after
assignment, remit all such hazard proceeds to
HUD, Multifamily Mortgage Notes.

Page 5 of 14 ref. Handbook 4350.1 form HUD-2741 (04/10)

8.

9.

Not all mortgages require the reserve for
replacements fund shown in column 10. Use this
column only if such a requirement is imposed by
the mortgage or other agreements. Please note the
following special instructions:
a. Where a Mortgage is Assigned to the
Secretary: In the event any or all of the funds
accumulated in the reserve for replacements
account were invested and redeemed at a price
other than par, the mortgagee must advise
MFCB as soon as possible of the type and
amount of such investments, the cost of the
investments (showing a breakdown of
brokerage fees), accrued interest and related
costs. Such investments must be redeemed on
assignment of the mortgage and forwarded to
HUD, Multifamily Mortgage Notes. In this
event, a statement, including documentation
of the redemption proceeds, is required
showing the date of redemption, amounts
received and any other information pertinent
to the transaction. The receipt and disposition
of all investment income received prior to the
date of default must be shown in column 10.
b. Where a Property is Conveyed to the
Secretary: In the event any or all of the funds
accumulated in the reserve for replacements
account were invested, the value of the
investment(s) as of the date of the foreclosure
sale must be determined and this amount
entered in column 10. If the property is being
conveyed pursuant to a deed in lieu of
foreclosure, the value of the investment(s)
must be determined as of the date the property
is deeded to the mortgagee, or, if by a direct
conveyance to the Secretary, the date title
passes to the Secretary. The receipt and
disposition of all investment income received
prior to the date of default must also be shown
in column 10.
c. For mortgages that have investments in the
reserves for replacement fund, the following
must take place as soon as possible after the
day the assignment is filed for record or the
property is conveyed:
i.
All investments must be liquidated.
ii.
Any penalties for early withdrawal of
investments must be absorbed by the
mortgagee.
iii.
For claims paid in debentures, all
investment proceeds received, plus the
cost of any penalties for early withdrawal,
must be remitted to HUD no later than
thirty (30) days after assignment to HUD,
Multifamily Mortgage Notes.
iv.
For claims paid in cash, proceeds
received, plus the cost of any penalties for
early withdrawal, must be retained by the
mortgagee
in
the
reserves
for
replacements fund.
Column 12 must be used to record all amounts
received which cannot be applied to sums due

10.

11.

12.

13.

under the mortgage. Report any payment received
after default which is not complete with respect to
escrows, interest, principal and reserve for
replacements in column 12. All payments received
after the date of election to receive insurance
benefits must be reported here. Include in this
column returned premiums on cancelled hazard
insurance policies, interest received after default
on investments of the reserve for replacements
fund, refunds of deposits left with utility
companies, amounts received as proceeds of a
receivership, etc. Enter dates received in column 1,
the amounts in columns 2 and 12, and identify the
source of the funds in column 11. Do not show net
rental income received during the period the
claimant operated the project, since Schedules B
and C are provided for reporting this amount.
From time to time disbursements may have been
made for items for which the escrow funds in
columns 4, 5, 6, 7, and 10 were established. Show
the date of disbursement in column 1 and the
amount disbursed in column 2 in parentheses,
show the due date of the item for which the
disbursement was made in column 3 and show the
amount disbursed again in parentheses in the
applicable columns (4, 5, 6, 7 or 10). All amounts
entered in column 7 must be identified in column
11. Disbursements in column 10 for any purpose
other than investments must be supported by
letters of authorization from HUD (form HUD9250). Hazard insurance premiums for policies
with the effective date after the date of assignment
or conveyance should not be paid.
After all entries have been made, sub-total
columns 4 through 7. A deficit balance in any of
these four columns may be offset by a transfer
from a column that has a credit balance. Report
transfers by showing “transfer of funds” in column
3.
The adjusted totals of the other columns must then
be shown in the space provided at the bottom of
the page. This schedule, if correctly and accurately
prepared, is self-balancing. The net total of column
2 must equal the totals of all the other columns.
Submit invoices and front and back copies of
cancelled checks, or receipted invoices; where
payment was made by wire or ACH, HUD will
accept from the mortgagee, in lieu of a front and
back copy of a cancelled check, wire advice
confirming such payment or the mortgagee’s bank
statement showing the wire or ACH that evidences
or includes such payment. Evidence of the last
payment of taxes, water and sewer charges, etc., in
column 5 must be evidenced as described above.
Invoices and evidence of payment, as described
above, must be submitted to cover all
disbursements shown in columns 6 and 7, made
subsequent to the date of default. In addition, such
supporting evidence is required for the last invoice
paid for hazard insurance, irrespective of whether
the last hazard insurance payment was made
before or after default.

Page 6 of 14 ref. Handbook 4350.1 form HUD-2741 (04/10)

14. Submit two copies of the mortgagee’s loan history
ledger records to support this schedule. If copies
were previously submitted and later entries were
made in the ledger, new copies are required. The
loan history must cover the period from the date
the claimant became the mortgagee to the date of
assignment or recordation of the deed to the
Secretary.
I. Preparation of form HUD-2744-B, Mortgagee’s
Report of Project Collections, Schedule B
Use this schedule only if the mortgagee either
directly, or through its servicer or the mortgagor,
has had control of the project property and is,
therefore, accountable for the collection of rents and
payment of operating expenses which the project
incurred during that period. Use it to report and
account for all rents collected by the mortgagee, or
its servicer, as well as to account for periods of
vacancies and rents in arrears.
1. In column 1 show the unit number or the other
symbol by which the units are identified. All
units, whether occupied or vacant, must be listed
and accounted for.
2. In column 2, report the occupancy status of each
unit in the project during the entire period from
the date the claimant took over control to the date
such control ended (the dates shown at the top of
the schedule). Show the status of the unit on the
date control was assumed by inserting tenant’s
name or the word “vacant” in column 2. If the
occupancy status changed, show on the next line
under the same unit number (which need not be
repeated) the change in status whether it was a
change in tenants or a change from occupancy to
vacancy or vice versa and complete the other
applicable columns. Repeat this procedure for
each change in order that the entire period is
covered.
3. In column 3, show the monthly rental rate. If the
rental rate was changed during the period covered
by the schedule, show the original rate in column
3 and the period during which that rate was in
effect in columns 4 and 6. Then show the new
rate in column 3 and the period during which it
was in effect in column 4 and columns 5 or 6,
whichever is applicable.
4. In column 4 show the date a tenant’s rent started
with respect to total collections shown in column
7 or unpaid rent in column 8. For example, if the
mortgagee assumed control on March 16th and
the tenant’s rent had been previously paid
through March 31st, the date the rent started
would be April 1st (assuming of course that all
rent is current and the tenant is paying from the
1st). Using the example above, if the tenant was
paying rent on a 15th to the 15th of a month
basis: the date shown in column 4 would be
March 15th. If a tenant was in arrears from
December 1st when a mortgagee assumed control
on March 16th, the date to be shown in column 4
would be December 1st.

5.

6.

7.

In column 6 show the date through which the
tenant’s rent was paid by calculating rent at the
rate or rates shown in column 3 against the total
rent paid as shown in column 7.
In column 7 show the total rents collected from
the tenant between the beginning and ending
dates shown at the top of the Schedule.
a. Do Not Prorate Rental Collections. For
example, if the property was conveyed to
the Secretary on the 15th of a month, all
rents collected by the mortgagee prior to
the 15th, regardless of the period covered
by the amounts received, are retained by
the mortgagee and accounted for on
Schedule B. All rents paid on the date of
conveyance and subsequent thereto must
be paid to the rental broker for HUD. If
any rent refund was made to a tenant,
enter the amount in parenthesis in column
7 and explain in column 2.
b. Do Not Show Rent Refunds on
Schedule C. There are some instances
where recurring items other than shelter
rental must be included on Schedule B,
such as furniture rental, flat charges for
utilities, garage rental, etc. All amounts
received for such items from each tenant
must be shown in column 7 after all
rental collections have been listed for the
tenant. A corresponding explanation must
be shown in column 2. Miscellaneous
collections not applicable to a particular
tenant must be shown at the end of the
report.
In column 8 show the amount of rents in arrears.
That is calculated as the daily rental rate
multiplied by the number of days from the date
shown in column 6 to the date shown in column 5
for those tenants who vacated, and covering the
period from that shown in column 6 to the date
the mortgagee relinquished control for those
tenants still in occupancy.
a. All balances due from present and former
tenants are formally assigned to the
Secretary in compliance with instructions
issued by the OGC. Column 8 of
Schedule B provides the data as to the
actual amounts due from tenants and
covered by that assignment. On the basis
of the amounts shown in column 8, HUD
will establish its records and will take
steps to collect amounts shown as due
from tenants. It is, therefore, of particular
importance that the amounts be correctly
shown.
b. After accounting for all units during the
mortgagee’s period of control, show
under heading Former Tenants all tenants
owing rent who vacated prior to the
mortgagee’s control of the property. If
available, show tenant’s full name, the
unit number, any collections made and

Page 7 of 14 ref. Handbook 4350.1 form HUD-2741 (04/10)

the balance still due. If the tenant has
given any evidence of the indebtedness
such as a note, this fact must be noted in
column 8 and that evidence must be
delivered to HUD.
8. Note: Do not report security deposit transactions
on this schedule. Security deposits collected and
forfeited by the tenants during the period of the
mortgagee’s operation of the project (but not
applied to rent) must be reported as other income
and shown in column 7 of form HUD-2744-A.
See the last paragraph of instruction number 6
above. Security deposits that are applied to rent
must be included in the total collections report in
column 7. Any security deposits on hand at date
of conveyance must be accounted for separately
and remitted to HUD, Multifamily Properties.
J. Preparation of form HUD-2744-C, Mortgagee’s
Report of Project Disbursements, Schedule C
Use this form to report, in chronological order,
disbursements for necessary project operating
expenses incurred by the mortgagee or its servicer
during its control or ownership. Do not include
disbursements for which the former mortgagor is
liable unless it was necessary for the claimant to
pay them. In this event, provide full, detailed
explanation as to the necessity for payment.
1. Column 1 is provided for convenience in
either listing receipted invoices numbered
consecutively or inserting the number of the
check in payment. The purpose of the
disbursement must be fully explained in
column 3. The dates and amounts of all
payments must be shown. Please take care to
pay all amounts chargeable to the period of
the claimant’s operation of the project, even
though the actual payment is made after the
end of the period.
2. As the footnote on the schedule indicates,
copies of paid invoices must be submitted in
support of all disbursements. Where receipts
for wages are not available, submit payroll
records that detail the rate of pay, number of
hours worked, amount withheld for taxes, etc.
K. Preparation
of
form
HUD-2744-D,
Other
Disbursements by the Mortgagee, Schedule D
List on this schedule all other disbursements
relating to the conveyance of the property, or
approved preservation expenses, if any. Do not
include advances of mortgage proceeds or
advances to escrow accounts. Show dates of all
payments in column 1 and all payees in column 2.
Do not include disbursements made in connection
with an assignment of a mortgage.
1. Reasonable expenses approved by the local
HUD office for the completion and

preservation of the property are allowable in
computing the amount of settlement.
2. Enter such amounts in column 3 and explain
the purpose in column 4. In columns 5, 6 and
7, list all other disbursements made in
connection with the conveyance of the
property which are to be included in the
Certificate of Claim. These will include
attorney’s fees, foreclosure costs, title policy,
surveys, taxes on deeds, recording fees,
special Commissioner’s fees and costs etc.
Use column 4 to explain the purpose of
disbursements shown in columns 5 and 7.
3. Costs incurred in connection with an
assignment of a mortgage cannot be included
in the Certificate of Claim.
4. Submit paid invoices or copies to support all
disbursements shown on this schedule.
L. Preparation of form HUD-2744-E, Mortgagee’s
Report of Special Escrow, Schedule E
Use Schedule E to report any special escrows. The
form must be submitted with the other fiscal data
forms.
1. Where the mortgage is assigned and the
settlement is made by the issuance of
debentures any balances shown must be
remitted to HUD.
2. Where the mortgage is assigned and the
settlement is made in cash, any balances
shown are retained by the mortgagee and
reported under Section 1(e)5 on form HUD2742.
5. Include receipts and authorizations for all
disbursements shown on Schedule E.
M. Preparation of form HUD-434, Statement of Taxes
1. Taxes that will become due within the fortyfive (45) day period from the filing for record
of the assignment or deed must be paid by the
mortgagee and included in the claim for
insurance benefits.
2. The amount of penalties paid on delinquent
taxes will be disallowed. The amount of
penalties may be included in the Certificate of
Claim if it was necessary for the mortgagee to
advance the funds to pay the taxes.
3. Copies of tax bills, plus evidence of payment,
as described previously in Preparation of
form HUD-2744-A, item 13, for the taxes last
paid must be submitted irrespective of
whether the tax was paid before or after
default.

Page 8 of 14 ref. Handbook 4350.1 form HUD-2741 (04/10)

N. Form HUD-2742, Fiscal Data in Support of Claim for Multifamily Mortgage Insurance Benefits
After completion of the schedules, the data must be transferred to form HUD-2742. The amounts to be transferred are as
follows:
Section Receiving Transferred
Information on form HUD-2742
Section I(a)
Section I(b)(1)
Section I(b)(2)
Section I(b)(3)
Section I(c)
Section I(d)
Section I(e)(1)
Section I(e)(2)
Section I(e)(3)
Section I(e)(4)
Section I(e)(5)
Section I(f)(1)
Section I(f)(2)
Section I(g)
Section I(h) (Not applicable to
conveyance claims. See the discussion
below.)*
Section II(a)
Section II(b)
Section II(c)
Section II(d)

Data to be Transferred from forms HUD-2744, Schedules A through E
Total from Schedule A, column 9
Total, if any, in parentheses, from Schedule A, column 4
Total, if any, in parentheses, from Schedule A, column 5
Total, if any, in parentheses, from Schedule A, column 6
Total from Schedule D, column 3
Balance of undisbursed mortgage proceeds, if any
Total, if any, of positive sums from Schedule A, column 4
Total, if any, of positive sums from Schedule A, column 5
Total, if any, of positive sums from Schedule A, column 6
Total, if any, of positive sums from Schedule A, column 10
Total, if any, of positive sums from Schedule A, column 7, plus any
balances developed on Schedule E. Identify the items in this space.
Total from Schedule B, column 7
Total from Schedule C, column 5
Total from Schedule A, column 12
One (1%) percent of the amount shown in Section I(a) of form HUD-2742

Total from Schedule D, column 5
Total from Schedule D, column 6
The same amount shown in Section I(h) on form HUD-2742
Total from Schedule D, column 7

* Section 1(h) does not apply to conveyances. It applies to all assignments except assignments of Sections 221(d)(3) and
221(h) below market interest rate mortgages and assignments of Section 803 mortgages which were accepted for insurance
subsequent to August 15, 1955. Nor does Section 1(h) apply to automatic assignments under Section 221(g)(4) and
mortgages financed with 11(b) bonds. When the assignment is made pursuant to 236.260, the one percent (1%) prescribed
under HUD Regulations at 24 CFR 207.259(b)(2)(iv) is not applicable. In addition, under such terms and conditions as the
Secretary may approve, all or part of the 1% deduction may be waived for assignments under other Sections of the Act.

VIII.

Legal Clearance
HUD makes final settlement only after legal clearance has
been received and fiscal requirements have been met. The
instructions for obtaining legal clearance are available
electronically through the MDDR system. Note: The legal
instructions contain additional deadlines and requirements
for submission of documents.

IX.

Final Claim Settlement
After the assignment of the mortgage, the mortgagee must
submit the fiscal package within forty-five (45) days after
the filing for record of the assignment to MFCB.
A. After the receipt of the fiscal package (form HUD2742, the claim for multifamily insurance benefits
and the supporting schedules A thru E), MFCB

submits the fiscal package and other supporting
documents to HUD’s contractor. The claim is
examined based on HUD Regulations at 24 CFR
207.259 and/or any other applicable regulations.
HUD performs a reconciliation of reserve for
replacement accounts based on the audited financial
statement issued three (3) years prior to the date of
assignment. Once HUD receives legal clearance, the
MFCB prepares the settlement sheet based on the
Unpaid Principal Balance (UPB) determined from
the Note as may be modified by a HUD-approved
Modification Agreement, plus the advances made by
the mortgagee, less the escrow balances retained.
The final claim amount is based on the principal
balance after deducting the principal amount of the
partial settlement.
B. Interest at the debenture rate is computed from the
date of default to the date of settlement, unless there
Page 9 of 14 ref. Handbook 4350.1 form HUD-2741 (04/10)

are any curtailments. The claim settlement is
prepared in the Multifamily Claims System. HUD
then prepares and certifies the Same Day Payment
voucher for the final settlement amount. Finally, the
Chief, MFCB sends a letter to the mortgagee that
explains how the claim was settled.
X.

Supplemental Claims
The mortgagee may file for a supplemental claim within
six months after the date of final claim settlement if it
believes that amounts are owed due to an error in
computation of the claim, or if there were any surcharges,
advances and expenses that were not included in the final
claim settlement. Documentation in support of the
supplemental claim must be filed with the request. Submit
the request and supporting documentation for the
supplemental claim in a letter, addressed to the Chief,
MFCB at HUD, Multifamily Claims Branch.

XI.

Insurance Benefits under Section 236 with Interest
Reduction Payments (IRP)
The filing requirements to receive insurance benefits for
mortgages insured under Section 236 with interest
reduction payments are the same as the requirements cited
in these instructions for other claims (reference HUD
Regulations at 24 CFR 207.255), whether assigned as a
result of a fiscal default or covenant default, with the
following exceptions:
A. IRP received after the default date and before
election can be lumped together to make a full
payment and move the default date forward.
B. Any IRP received after assignment must be sent to
HUD, CFO Accounting, Monitoring & Analysis
Division.
C. Assignment of mortgage pursuant to 24 CFR
236.260 is requested by the Commissioner.
D. This regulation states that the mortgagee shall, when
requested by the Commissioner, assign to the
Commissioner a mortgage on which interest
reduction payments are being made pursuant to the
provisions of HUD Regulations at 24 CFR 236.501.
If the mortgage is not in default (not a fiscal default
or covenant default) when the Commissioner
requests its assignment, the first day of the month
following HUD’s request shall be considered the
date of default.
Pursuant to HUD Regulations at 24 CFR
236.265(c), where the assignment of the mortgage is
made pursuant to 236.260 and the mortgage is not in
fiscal or covenant default at the time of such
assignment, the one percent deduction prescribed in

24 CFR Section 207.259(b)(2)(iv) shall not be
applicable.
XII.

Insurance Benefits under Section 221(g)(4)
A mortgagee of a mortgage insured under Section 221 of
the National Housing Act has the option under Section
221(g)(4) to assign to the Secretary of HUD the original
credit instrument and the mortgage provided it is not in
default at the expiration of the twenty (20) year period
from the date of final endorsement. The requirements for
filing insurance benefits under 221(g)(4) are the same as
for regular claims prescribed under Section 207.255 and
requirements cited in these instructions, with the
following exceptions:
A. The mortgagee must elect to assign the property
within one year after the completion of the twentieth
(20th) anniversary of the final endorsement date.
B. The debenture will have a ten (10) year term for
automatic assignments.
C. One percent of UPB is not deducted from the claim.
D. Accrued interest at the mortgage rate is calculated
from the last payment to the date of assignment and
added to the claim.
E. Any hazard insurance premium which becomes due
forty-five (45) days from the date of assignment
must be paid by the claimant. A receipted invoice,
or front and back copies of the cancelled check,
must be submitted to HUD, Multifamily Claims
Branch so that the payment may be reflected in the
insurance settlement. Because HUD will escrow for
hazard insurance premiums for 221(g)(4) cases, the
following information is required:
1. Copy of hazard insurance policy;
2. Name of hazard insurance carrier and a contact
person with a phone number;
3. Copy of last paid hazard insurance invoice;
4. Due date of next hazard insurance premium
payment;
5. Amount of hazard insurance escrow to be
transferred to HUD, and
6. Date and amount of last payment to the hazard
insurance escrow account.
7. Immediately, following the date of assignment,
the hazard insurance information listed above
must be mailed to HUD, Multifamily Notes
Servicing.

Page 10 of 14 ref. Handbook 4350.1 form HUD-2741 (04/10)

XIII.
Assignment
CFR
Commissioner
Conveyance
Covenant default
Date of default

Debenture Lock Agreement

Debentures
Default
Election to Assign Approval
Letter
Election to convey
Fiscal Data
Fiscal Default
Form HUD-1044-D
Form HUD-2537
Form HUD-2742
Form HUD-2744-A
Form HUD-2747
Form HUD-9250
Holding mortgagee
Initial endorsement
IRP
Legal clearance

MDDR
MFCB
Mortgagee
Mortgagee’s Certificate

Mortgagor
Notice of Default
Notice of Election

GLOSSARY OF TERMS AND ACRONYMS

When a mortgagee assigns to HUD, the rights to the mortgage loan along with the property
that is the collateral to the loan (24 CFR 207.258(b)).
Code of Federal Regulations
Federal Housing Administration Commissioner
The transfer of the property/project’s title and possession of the property to HUD by the
mortgagee.
The failure of the owner to perform any other covenant under the provisions of the mortgage
or of the regulatory agreement, which is incorporated into the mortgage.
The date of the first uncorrected failure to perform a covenant or an obligation, or the date of
the first failure to make a monthly payment which subsequent payments by the mortgagor are
insufficient to cover when applied to the overdue monthly payments in the order in which they
become due (24 CFR 207.255(d).
An Agreement by HUD that, in the event of an insurance claim, insurance benefits will be
paid in debentures and HUD will defer redemption of such debentures until insurance
benefits are sufficient to retire the remaining unpaid mortgage. debt.
Debentures are registered, transferable securities which are valid and binding obligations,
issued in the name of the insurance fund under which the mortgage was insured.
If a second consecutive payment on a loan is missed, then the loan moves into a default status
(see date of default). There are two types of defaults; fiscal default and covenant default.
The electronic submission the Office of Housing sends to the mortgagee, copy to MFCB,
which approves the Notice of Election to Assign filed by the mortgagee
The mortgagee’s indication of its intention to obtain and transfer the property/project’s title
and possession of the property to the Commissioner. See Notice of Election to Convey.
Documentation that the mortgagee must file to complete its application for insurance benefits.
A monetary, or fiscal, default exists when the owner fails to make any payment due under the
mortgage.
Form HUD-1044-D, Multifamily Insurance Benefit Claim, Payment Information in Support
of Claim
Form HUD-2537, Mortgagee’s Application for Partial Settlement.
Form HUD-2742, Fiscal Data in Support of Claim for Insurance Benefits.
Form HUD-2744-A, Allocation of Mortgagee’s Receipts and Disbursements, Schedule A.
Form HUD-2747, Mortgagee’s Application for Insurance Benefits.
Form HUD-9250, Funds Authorizations.
Holder or owner of the mortgage note - Claims benefits are paid to the holding mortgagee.
The first advance of mortgage proceeds.
Interest Reduction Payments.
The process by which HUD’s Office of General Counsel, Multifamily Mortgage Division
(“OGC”) receives, reviews, and approves the documents required by the Legal Instructions
Concerning Applications for Full Insurance Benefits – Assignment of Multifamily Mortgages
to the Secretary (“Legal Instructions”). Once the mortgagee has satisfied the requirements of
the Legal Instructions, OGC notifies the mortgagee (or its servicer) that HUD has completed
its review of legal documents, that the legal requirements for issuance of insurance benefits
were deemed complete on [date], and whether the legal requirements were met within the
legal submission deadline.
Multifamily Delinquency and Default Reporting.
Multifamily Claims Branch.
The lender in a mortgage agreement. In this document, the term “mortgagee” refers to the
holding mortgagee.
The lender executes the Mortgagee's Certificate at the loan closing. In executing the
Certificate, the lender identifies all fees and escrow deposits collected in conjunction with the
mortgage transaction and agrees to collect, hold and administer the reserve for replacements
and any required mortgage escrows in accordance with HUD's requirements.
An individual, corporation, or partnership that borrows money from the lending institution
(the mortgagee) in exchange for a mortgage on his/her property).
The electronic submission that the mortgagee must submit to HUD within 60 days from the
date of default.
The electronic submission the mortgagee must submit to HUD, to provide the Commissioner
notice of its intention to file an insurance claim.
Page 11 of 14 ref. Handbook 4350.1 form HUD-2741 (04/10)

Notice of Election to Assign
Notice of Election to Convey
OAM
OGC
Prorate

Regulatory agreement

Reinstatement
Reserve for replacements

Rolling default

Schedule A
Schedule B
Schedule C
Schedule D
Schedule E
Section 236
Section of the Act

Servicer

UPB

The electronic submission the mortgagee must submit to HUD, to provide the Commissioner
notice of its intention to assign the mortgage and file an insurance claim.
The electronic submission the mortgagee must submit to HUD, to provide the Commissioner
notice of its intention to acquire and convey title and file an insurance claim.
HUD Headquarters’ Office of Asset Management.
Office of the General Counsel.
To divide or apportion an amount according to the number of days or months during the
period . Can relate to the amount of rent owed by a resident for occupying a unit for only a
part of a month
The regulatory agreement lists the management and reporting requirements that HUD and the
lender impose upon the owner in return for their insuring the mortgage. The regulatory
agreement also specifies what actions the lender and/or HUD may take if the owner does not
carry out its obligations under the regulatory agreement so long as the mortgage insurance is
in effect.
The action of reverting a defaulted mortgage to a non-default status pursuant to 24 CFR
§207.256a.
The regulatory agreement requires an owner to establish and maintain a reserve for
replacements. The reserve provides cash for the replacement of capital items (e.g. appliances).
The reserve is funded from two sources (1) a lump sum deposit made at the time of loan
closing and (2) monthly deposits made as part of the monthly mortgage payments.
A rolling default occurs when a loan is in fiscal default and has been reported in MDDR and
the owner then makes a subsequent payment, prior to the lender submitting an election to
assign that is less than the amount necessary to bring the loan current. The payment should be
applied to the overdue monthly payments in the order in which they became due and the date
of default will roll forward to the date of the first overdue payment that the subsequent
payment is insufficient to cover. The change in the date of default will advance the
corresponding deadline for filing the election to assign.
See form HUD-2744-A.
Form HUD-2744-B, Mortgagee’s Report of Project Collections, Schedule B.
Form HUD-2744-C, Mortgagee’s Report of Project Disbursements, Schedule C.
Form HUD-2744-D, Mortgagee’s Report of Other Disbursements, Schedule D.
Form HUD-2744-E, Mortgagee’s Report of Special Escrows, Schedule E.
FHA multifamily mortgage insurance with subsidies on interest for low/moderate income
projects.
Act is a law passed by Congress that authorizes programs to be administered by HUD. The
Section of the Act refers to that part of the law that authorizes a particular program or sets out
particular rules or requirements.
The company that collects monthly mortgage payments and disperses property taxes and
insurance payments. Loan servicers may be the lender or a company that just handles loan
servicing under contract with the lender or the investor who owns the loan.
Unpaid principal balance of the mortgage.

Page 12 of 14 ref. Handbook 4350.1 form HUD-2741 (04/10)

XIV.

Contact Points, Addresses, Phone and Fax Numbers:
Chief, MFCB: (Fax): (202) 619-8259
HUD, Director, CFO Accounting, Monitoring &
Analysis Branch (IRP):
U.S. Department of Housing and Urban Development
Director, CFO Accounting, Monitoring & Analysis
Branch
451 Seventh Street S.W.
Washington, D.C. 20410
(202) 402-3695 (call for instructions to pay by wire)

HUD, Multifamily Claims Branch:
HUD, Multifamily Claims Branch, HWAFRC
451 Seventh Street, S.W.
Washington, D.C. 20410-8000
[email protected]

Fax: (202) 619-8259

HUD, Multifamily Mortgage Notes (escrow balances
and other payments on behalf of mortgagee):
HUD, Multifamily Mortgage Notes
PO Box 530256
Atlanta, GA 30353-0256

HUD, Multifamily Notes Servicing (tax and hazard
insurance information address):
DYNAXYS
Attn: Accounting Department
PO Box 4308
Silver Spring, MD 20904-3038

HUD, Multifamily Properties (security deposits):
HUD Multifamily Properties
P.O. Box 403467
Atlanta, GA 30384-3467

Page 13 of 14 ref. Handbook 4350.1 form HUD-2741 (04/10)

XV.

Check List for Filing Claims for Insurance Benefits
Follow the detailed instructions to prepare your claim.
This check list is to serve only as a guide for mortgagees
to properly submit the supporting data for a claim for
insurance benefits. HUD is anxious to settle all claims as
soon as possible, and every effort is made to do so. You
can help in the prompt settlement of your claim by being
certain that all forms are properly completed, and that the
ledger records and all supporting receipts are furnished, in
triplicate, in legible condition. If the submission is
incomplete, it will require correspondence, which will
result in a delay in the settlement.
A. For the purpose of receiving fiscal clearance, the
following items, as applicable, must be forwarded:

Completed form HUD-2742, Fiscal Data in
Support of Claim for Insurance Benefits

Form HUD-2744-A, Allocation of
Mortgagee’s Receipts and Disbursements,
Schedule A

Form HUD-2744-B, Mortgagee’s Report of
Project Collections, Schedule B (if
applicable)

Form HUD-2744-C, Mortgagee’s Report of
Project Disbursements, Schedule C (if
applicable)

Form HUD-2744-D, Mortgagee’s Report of
Other Disbursements, Schedule D, (if
applicable)

Form HUD-2744-E, Mortgagee’s Report of
Special Escrows, Schedule E (if applicable)

Form HUD-434, Statement of Taxes,
including copies of tax bills for the taxes last
paid

Two (2) copies of original loan ledger
records



Receipts or other evidence of payment
covering all disbursements on and after the
date of default, as shown on Schedule A, for
taxes, hazard insurance premiums, water
rates, etc.

Copies of authorizations covering the
release of all monies disbursed from the
reserve for replacements fund

Documentation of proceeds from the
liquidation of any investments (for
debentures only) held as part of the reserve
for replacements fund.

Receipts and authorizations for all
disbursements shown on Schedule E (if
applicable)

Copy of bond trust indenture and
informational letter (if applicable)

Copy of the Debenture Lock Agreement (if
applicable)
B. The mortgagee, at its option, may deliver, or HUD
may, at its option, request the following additional
photocopies from the Mortgagee, to the extent that
the mortgagee has in its possession such
documentation:

Note(s) with any allonge or modification
changing payment terms
Regulatory Agreement with any

amendments

FHA Firm Commitment with any
amendments
Mortgagee’s Certificate

C. As may be approved by MFCB, delivery of one or
more specified documents may be completed
through PDF or CD delivery.

Review your submission to verify that you, as the mortgagee, have provided full and complete disclosure of all monies held
or receivable on behalf of the mortgagor, including but not limited to insurance proceeds and any legal claims.
Have the forms properly certified.
Warning: Anyone who knowingly submits a false claim or makes a false statement is subject to criminal and/or civil penalties,
including confinement for up to 5 years, fines, and civil and administrative penalties. (18 U.S.C. §§287, 1001, 1010, 1012; 31
U.S.C. §3729, 3802)”

Paperwork Burden Disclosure
Public reporting burden for this collection of information is estimated to average 2 hours response, including the time for
reviewing instructions searching existing data sources, gathering and maintaining the data needed, and completing, and
reviewing the collection information. This agency may not conduct or sponsor, and a person is not required to respond to,
a collection information unless that collection displays a valid OMB control number.

Page 14 of 14 ref. Handbook 4350.1 form HUD-2741 (04/10)