Implementation of the Privacy Act of 1974, as Amended; System of Records Notice Amendment, Home Equity Reverse Mortgage Information Technology, 33690-33693 [2016-12597]

Agencies

• DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

[Federal Register Volume 81, Number 103 (Friday, May 27, 2016)]
[Notices]
[Pages 33690-33693]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-12597]


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DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

[Docket No. FR-5921-N-03]


Implementation of the Privacy Act of 1974, as Amended; System of 
Records Notice Amendment, Home Equity Reverse Mortgage Information 
Technology

AGENCY: Office of Housing, HUD.

ACTION: System of records notice amendment.

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SUMMARY: In accordance with the Privacy Act of 1974, the Department of 
Housing and Urban Development is giving notice that it intends to amend 
one of its systems of records published in the Federal Register at 77 
FR 61620 on October 10, 2012, the Home Equity Reverse Mortgage 
Information Technology (HERMIT). This notice will be written to include 
updates to the former notice routine uses and records categories 
statements. This notice also incorporates administrative and format 
changes to convey already published information in a more synchronized 
format. A more detailed description of the revision created by this 
notice is defined under this notice supplementary information caption.

DATES: 
    Effective Date: The notice shall be effective immediately upon 
publication of this notice in the Federal Register, except for the new 
routine use created, which will become effective June 27, 2016, unless 
comments are received that would result in a contrary determination.
    Comments Due Date: June 27, 2016.

ADDRESSES: Interested persons are invited to submit comments regarding 
this notice to the Rules Docket Clerk, Office of the General Counsel, 
Department of Housing and Urban Development, 451 Seventh Street SW., 
Room 10276, Washington, DC 20410-0500. Communication should refer to 
the above docket number and title. Faxed comments are not accepted. A 
copy of each communication submitted will be available for public 
inspection and copying between 8 a.m. and 5 p.m. weekdays at the above 
address.

FOR FURTHER INFORMATION CONTACT: Frieda B. Edwards, Acting Chief 
Privacy Officer, 451 Seventh Street SW., Room 10139, Washington, DC 
20410, telephone number 202-402-6828 (this is not a toll-free number). 
Individuals who are hearing- and speech-impaired may access this number 
via TTY by calling the Federal Relay Service telephone number at 800-
877-8339 (this is a toll-free number).

SUPPLEMENTARY INFORMATION: The HERMIT notice amendment will identify: 
(1) New disclosure requirements, by adding routine use number eight to 
clarify that records may be provided from this system to housing 
counselors when needed to comply with new housing counseling policies 
and training and certification related requirements; (2) updates to the 
record categories to include a ``Loan Production'' category, which will 
distinguish when specific records are collected by this system during 
this phase; (3) new records on the certificate of qualification to 
verify that a housing counselor is certified by HUD as a component to 
provide counseling services. Publication of this notice allows the 
Department to keep an up-to-date accounting of its system of records 
publications. This publication meets the threshold requirements 
pursuant to the Privacy Act and OMB Circular A-130. A report was 
submitted to the Office of Management and Budget (OMB), the Senate 
Committee on Homeland Security and Governmental Affairs, and the House 
Committee on Government Reform as instructed by Paragraph 4c of 
Appendix I to OMB Circular No. A-130, ``Federal Agencies 
Responsibilities for Maintaining Records About Individuals,'' July 25, 
1994 (59 FR 37914).


[[Page 33691]]


    Authority: 5 U.S.C. 552a; 88 Stat. 1896; 42 U.S.C. 3535(d).

    Dated: April 28, 2016.
Patricia A. Hoban-Moore,
Senior Agency Official for Privacy.
SYSTEM OF RECORDS NO.:
    HSNG/HWAT.01.

SYSTEM NAME:
    Home Equity Reverse Mortgage Information Technology (HERMIT)--P271.

SYSTEM LOCATION:
    The system is accessible at workstations located at the following 
locations: Department of Housing and Urban Development Headquarters, 
451 Seventh Street SW., Washington, DC 20410; HUD's Field and Regional 
Office locations: The National Servicing Center, 2 West 2nd Street, 
Suite 400, Tulsa, OK 74103; Atlanta Homeownership Center, Five Points 
Plaza, 40 Marietta Street, Atlanta, GA 30303; Philadelphia 
Homeownership Center, Wanamaker Building, 100 Penn Square East, 
Philadelphia, PA 19107; Denver Homeownership Center, Processing and 
Underwriting, 20th floor, 1670 Broadway, Denver, CO 80202; and Santa 
Ana Homeownership Center, Santa Ana Federal Building, 34 Civic Center 
Plaza, Room 7015, Santa Ana, CA 92701. The system is externally hosted 
at the business service provider's site (contractor primary) and 
disaster recovery facilities.

CATEGORIES OF INDIVIDUALS COVERED BY THE SYSTEM:
    HECM mortgagees and HECM mortgagors for Home Equity Conversion 
Mortgages insured under HUD's HECM mortgage insurance program and FHA-
Approved Housing Counselors who participate in the HECM program. Note: 
The Privacy Act applies to the extent that the information collected 
pertains to an individual; information pertaining to corporations and 
other business entities and organizations are not subject to the 
Privacy Act.

CATEGORIES OF RECORDS IN THE SYSTEM:
    HERMIT information is collected on individual program participants.
     Loan Production: HERMIT loan production records include 
personally identifiable information (PII) data pertaining to HECM 
Housing Counseling data: Full name of HECM housing counselor, HECM 
Certificate of Counseling, HECM counselor ID numbers, and borrowers' 
full names, property addresses, birthdates, Social Security numbers, 
and phone numbers.
     Insurance-in-Force (IIF)/Premiums: HERMIT insurance-in-
force and premium records include PII data pertaining to borrowers' 
full names, property addresses, birthdates, Social Security numbers, 
phone numbers and dates of death; maximum claim amount (MCA), property 
appraised values, initial and monthly mortgage insurance premiums (IMIP 
and MMIP), set asides, note interest rates and expected interest rates 
and case statuses and sub-case statuses; payment plan types, and other 
financial account data such as principal limits, monthly interest 
accruals, late charge and interest charge fees, historical transaction 
records for HECM cases, property taxes and hazard insurance amounts, 
business partners' banking information (routing and account numbers); 
and accounting data including accounts receivable and payable due to 
and from HUD.
     HECM Claims: Borrowers' names, addresses, Social Security 
numbers; MCAs, due and payable approvals; death notifications, deed-in-
lieu; foreclosure actions, extension approvals, interest rates and 
account statuses; payment and other financial account data such as 
unpaid loan balances, interest accrued, service fees, expenses incurred 
for foreclosure and acquisition, protection and preservation, attorney 
fees, special assessments; disbursements for taxes, insurance, 
utilities, eviction fees, and any other miscellaneous disbursements; 
initial and monthly mortgage insurance premiums (IMIP and MMIP), 
appraisals, closing costs; claims filed and paid; indemnifications and 
claim blocks; business partner banking information tax identification 
number (TIN), routing and account numbers), mortgagee reference number; 
accounting data, including established accounts receivables and 
payables; and information for reporting and assumption of servicing 
activities in cases of investor claim or default.
     HECM Loan Servicing: Borrowers' and authorized contacts' 
names and addresses, birthdates, ages, Social Security numbers, phone 
numbers; email addresses; marital statuses, genders, preferred 
languages, banking information (institutional information, routings 
account numbers and account types) maximum loan amounts, premium 
collections, interest rates and account statuses; payments and other 
financial account data such as loan balances, loan history, interest 
accrued, fees incurred, claims filed and paid, real estate property 
information, property taxes and insurance amounts, accounting data, 
including debits and credits to HUD accounts based on transaction 
events, vendor information; and information for reporting and assuming 
servicing activities in case of servicer or investor claim or default.

AUTHORITY FOR MAINTENANCE OF THE SYSTEM:
    Section 255 of the National Housing Act of 1934 authorizes the 
Federal Housing Administration (FHA) reverse mortgage program for the 
elderly, the Home Equity Conversion Mortgage (HECM) program (12 U.S.C. 
1715Z-20). The Housing and Community Development Act of 1987 (42 U.S.C. 
3543) specifically provides authority to collect Social Security 
numbers.

PURPOSE:
    HERMIT integrates the endorsement; insurance servicing; claims 
payment; notes servicing, accounting, and reporting requirements of 
FHA's HECM insurance program. The HECM program promotes continued 
homeownership for the elderly by allowing elderly borrowers to access 
the equity in their homes while continuing to live in the property. 
HERMIT allows the Secretary to maintain the ``public trust'' over the 
HECM program by seamlessly, accurately, and timely managing the HECM 
program in an automated environment. HERMIT allows HECM program 
personnel to collect and maintain the data necessary to support 
activities related to the endorsement of loans and collection of IMIP 
and MMIP. The claims process includes the filing of claims for 
insurance benefits and disbursement of funds to lenders of loans 
insured under the HECM program. Servicing activities include 
maintaining the data necessary to support performance requirements of 
servicing for FHA-insured and Secretary-held first and second 
mortgages. The major activities include acceptance of assignment and 
title review, servicing requests for HECM endorsed cases from 
mortgagees (due and payable, short sale, preservation and protection 
costs, subordination extension requests, and partial releases), 
accounting functions, collections according to the Fair Debt Collection 
Practices Act, disbursement of payment, annual recertification, 
foreclosure activities, bankruptcy activities, and compliance 
monitoring. HERMIT provides HECM mortgagees with the ability to 
interact with HUD's National Servicing Center (NSC) to improve HECM 
loan servicing and to provide an automated claims filing process.

ROUTINE USES OF RECORDS MAINTAINED IN THE SYSTEM, INCLUDING CATEGORIES 
OF USERS AND THE PURPOSES OF SUCH USES:
    In addition to those disclosures generally permitted under 5 U.S.C. 
Section 552a(b) of the Privacy Act, all or

[[Page 33692]]

a portion of the records or information contained in this system may be 
disclosed outside HUD as a routine use pursuant to 5 U.S.C. 552a(b)(3) 
as follows:
    (1) To servicing mortgagee to give notice of miscalculations or 
other errors in subsidy computation, to pay claims, or for other 
servicing-related functions.
    (2) To taxing authorities, insurance companies, homeowners 
associations, or condominium associations for maintaining the property 
while HUD is the servicer of record to ensure property taxes are 
current.
    (3) To the U.S. Department of the Treasury for collection and 
disbursement transactions (Pay.gov, Automated Clearing House (ACH)).
    (4) To title insurance companies or financial institutions to allow 
HUD to respond to inquiries for payoff figures on HECM assigned loans.
    (5) To recorders' offices for recording legal documents and 
responses to bankruptcy courts or other legal responses required during 
the servicing of the insured loan to allow HUD to release mortgage 
liens, respond to bankruptcies or deaths of mortgagors to protect the 
interest of the Secretary of HUD.
    (6) To the Federal Bureau of Investigation to investigate possible 
fraud revealed in the course of servicing efforts to allow HUD to 
protect the interest of the Secretary.
    (7) To an Administrative Law Judge and to the interested parties to 
the extent necessary for conducting administrative proceedings where 
HUD is a party.
    (8) To welfare agencies for fraud investigation to allow HUD to 
respond to state government inquiries when a HECM mortgagor is 
committed to a nursing home.
    (9) To housing counselors to comply with new HECM housing 
counseling policies to include training and certification.
    (10) To FHA-approved HECM mortgagees to comply with new HECM 
statutory requirements and FHA HECM policies issued via mortgagee 
letters and updates to Housing handbooks.
    (11) To appropriate agencies, entities, and persons to the extent 
such disclosures are compatible with the purpose for which the records 
in this system were collected, as set forth by Appendix I \1\--HUD's 
Routine Use Inventory Notice published in the Federal Register.
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    \1\ https://portal.hud.gov/hudportal/documents/huddoc?id=append1.pdf.
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    (12) To appropriate agencies, entities, and persons when:
    (a) HUD suspects or has confirmed that the security or 
confidentiality of information in a system of records has been 
compromised;
    (b) HUD has determined that as a result of the suspected or 
confirmed compromise there is a risk of harm to economic or property 
interests, identity theft, or fraud, or harm to the security or 
integrity of systems or programs (whether maintained by HUD or another 
agency or entity) that rely upon the compromised information; and
    (c) The disclosure made to such agencies, entities, and persons is 
reasonably necessary to assist in connection with HUD's efforts to 
respond to the suspected or confirmed compromise and prevent, minimize, 
or remedy such harm for purposes of facilitating responses and 
remediation efforts in the event of a data breach.
    (13) The National Archives and Records Administration (NARA) and 
the General Services Administration (GSA) for records having sufficient 
historical or other value to warrant its continued preservation by the 
United States Government, or for inspection under authority of Title 
44, Chapter 29, of the United States Code.
    (14) A congressional office from the record of an individual, in 
response to an inquiry from the congressional office made at the 
request of that individual.

POLICIES AND PRACTICES FOR STORING, RETRIEVING, ACCESSING, RETAINING, 
AND DISPOSING OF RECORDS IN THE SYSTEM:
Storage:
    Records in this system are stored electronically in secure 
facilities. Electronic files are stored in case files on secure servers 
and backup files are stored on tapes. Electronic files are replicated 
at a disaster recovery offsite location in case of loss of computing 
capability or other emergency at the primary facility. HERMIT does not 
have paper records.

RETRIEVABILITY:
    Electronic records are retrieved by name, SSN, Loan Skey, home 
telephone number, personal email address, FHA case number and mortgagee 
TIN.

SAFEGUARDS:
    Access to electronic records is by: (1) User ID and password and 
(2) code identification card access, and limited to authorized users 
with an approved need-to-know. In addition to the safeguards provided 
by access controls, all electronic data is encrypted while stored on 
any systems media within HERMIT or in any transport mode. Servers are 
contained in a secured facility with twenty four hours and seven days a 
week security, including security guards, electronic access and 
surveillance capabilities (Close Caption Television (CCTV) and 
recorders, motion detectors, hand geometry readers, and/or fiber vault) 
at an offsite location. HERMIT does not have paper records.

RETENTION AND DISPOSAL:
    In accordance with General Records Schedule 1.1, Financial 
Management and Reporting Records, Items 010 and 011, the records are 
maintained for six years or when business use ceases. Paper records are 
not in use. Backup and Recovery digital media will be destroyed or 
otherwise rendered irrecoverable per NIST SP 800-88 ``Guidelines for 
Media Sanitization'' (September 2006).

SYSTEM MANAGER AND ADDRESS:
    Director, Office of Housing, Office of Finance and Budget, 
Department of Housing and Urban Development, 451 Seventh Street SW., 
Washington, DC 20410.

NOTIFICATION AND RECORD ACCESS PROCEDURES:
    For Information, assistance, or inquiries about the existence of 
records contact Frieda B. Edwards, Acting Chief Privacy Officer, 451 
Seventh Street SW., Room 10139, Washington, DC 20410, telephone number 
202-402-6828. When seeking records about yourself from this system of 
records or any other HUD system of records, your request must conform 
with the Privacy Act regulations set forth in 24 CFR part 16. You must 
first verify your identity by providing your full name, current 
address, and date and place of birth. You must sign your request, and 
your signature must either be notarized or submitted under 28 U.S.C. 
1746, a law that permits statements to be made under penalty of perjury 
as a substitute for notarization. In addition, your request should:
    (1) Explain why you believe HUD would have information on you.
    (2) Identify which HUD office you believe has the records about 
you.
    (3) Specify when you believe the records would have been created.
    (4) Provide any other information that will help the FOIA staff 
determine which HUD office may have responsive records.
    If you are is seeking records pertaining to another living 
individual, you must obtain a statement from that individual certifying 
their agreement for you to access their records. Without the above 
information, the HUD FOIA Office may not be able to conduct an

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effective search, and your request may be denied due to lack of 
specificity or lack of compliance with applicable regulations.

CONTESTING RECORD PROCEDURES:
    The Department's rules for contesting contents of records and 
appealing initial denials appear in 24 CFR part 16, Procedures for 
Inquiries. Additional assistance may be obtained by contacting Frieda 
B. Edwards, Acting Chief Privacy Officer, 451 Seventh Street SW., Room 
10139, Washington, DC 20410, or the HUD Departmental Privacy Appeals 
Officers, Office of General Counsel, Department of Housing and Urban 
Development, 451 Seventh Street SW., Room 10110, Washington, DC 20410.

RECORD SOURCE CATEGORIES:
    Records in the system are obtained from FHA-approved HECM 
mortgagees and third party providers, mortgagors, taxing authorities, 
insurance companies, and Housing counselors. FHA-approved HECM 
mortgagees collect the personal information from program participants 
(mortgagors) and enter the information into the FHA Connection--HUD's 
forward facing Web page portal. The FHA Connection transfers HECM 
information to the Computerized Homes Underwriting Management System 
(CHUMS). CHUMS updates HERMIT via an authorized interface to provide 
HECM information.

SYSTEMS EXEMPTED FROM CERTAIN PROVISIONS OF THE ACT:
    None.

[FR Doc. 2016-12597 Filed 5-26-16; 8:45 am]
BILLING CODE 4210-67-P