Department of Housing and Urban Development (HUD)

The Department of Housing and Urban Development is the executive department of the federal government responsible for national housing and urban development programs. Its enabling provision, 42 U.S.C. 3532(a), reads: "There is hereby established at the seat of government an executive department to be known as the Department of Housing and Urban Development", with a Secretary at its head appointed by the President with the advice and consent of the Senate. HUD is the abbreviation the department uses for itself and the name most people search; "U.S." in front of it is a style choice rather than part of the statutory name.

For a household, HUD shows up in a handful of specific places: a mortgage insured by the Federal Housing Administration, a reverse mortgage, a rental voucher or public housing unit, a fair housing complaint, a housing counselor, the federal code a manufactured home is built to, and the sale of homes that came to HUD after a foreclosure on an FHA-insured loan. Each of those has its own rules, and this page is a map of which part of HUD sits behind which one.

The Federal Housing Administration is inside HUD. Under 42 U.S.C. 3533(b) there is "in the Department a Federal Housing Commissioner, who shall be one of the Assistant Secretaries, who shall head a Federal Housing Administration within the Department" and who administers "departmental programs relating to the private mortgage market." So "FHA" and "HUD" are not two agencies, and documents use the names interchangeably for the same insurance programs. What FHA does is insure: the loan is made and serviced by a private FHA-approved lender, and FHA promises to cover that lender's losses if the borrower defaults. The FHA loan used to buy a home, the 203(k) loan that adds repair costs to a purchase, and the home equity conversion mortgage (the FHA reverse mortgage) are all FHA programs with their own pages.

Rental assistance runs through local agencies. HUD funds public housing and the Housing Choice Voucher Program, but a household applies to and deals with a local public housing agency, which federal law defines as "any State, county, municipality, or other governmental entity or public body (or agency or instrumentality thereof)" authorized to develop or operate public housing (42 U.S.C. 1437a(b)(6)). Waiting lists, payment standards and many day-to-day rules are set at that level within HUD's framework, which is why two cities can run the same federal program quite differently.

Fair housing enforcement. HUD enforces the Fair Housing Act alongside the Department of Justice. Under 42 U.S.C. 3610(a)(1)(A)(i) an aggrieved person "may, not later than one year after an alleged discriminatory housing practice has occurred or terminated, file a complaint with the Secretary". The complaint must be in writing, and HUD must acknowledge it and tell the complainant about the time limits and the choice of forums that follow.

Smaller roles that still reach consumers. HUD certifies housing counseling agencies: a "HUD-approved counseling agency" is a private or public nonprofit organization exempt from tax under section 501(c) and "certified by the Secretary to provide housing counseling services" (12 U.S.C. 1701x). The Secretary also establishes, by order, the Federal manufactured home construction and safety standards (42 U.S.C. 5403), the federal code a manufactured home is built to in place of a local building code, which is why it is commonly called the HUD Code. And when a lender forecloses on an FHA-insured loan and conveys the home to HUD to be paid under the FHA insurance, HUD sells it to the public through HUD-registered brokers on its HUD Home Store site.

What HUD does not do. It does not make most mortgages; private lenders do, and FHA insures some of them. It is not the supervisor of Fannie Mae, Freddie Mac or the Federal Home Loan Banks, which answer to the Federal Housing Finance Agency, and it does not set the conforming loan limit. Its one remaining rule-writing role over Fannie Mae and Freddie Mac is fair housing: 12 U.S.C. 4545 directs the Secretary to prohibit them, by regulation, from discriminating in the mortgages they buy. It also no longer writes the rules under the Real Estate Settlement Procedures Act: the Dodd-Frank Act transferred "all consumer protection functions" of the HUD Secretary under RESPA, the SAFE Act's mortgage licensing rules and the Interstate Land Sales Full Disclosure Act to the Consumer Financial Protection Bureau (12 U.S.C. 5581(b)(7)). Older documents and handbooks that call a RESPA rule a "HUD rule" date from before that transfer.

Because HUD reaches households through several separate programs, the useful question is usually which office or partner handles a given problem. A borrower with an FHA-insured mortgage deals with the private lender or servicer first, and FHA's role is the insurance behind the loan. A renter with a voucher deals with the local public housing agency that issued it. A person who believes they were refused housing or a loan because of a protected characteristic files with HUD's fair housing office within one year. A homeowner facing foreclosure or a first-time buyer looking for guidance can use a HUD-approved counseling agency. A buyer interested in a government-owned home bids through a HUD-registered broker.

Consider an example of how that routing plays out. Marisol rents an apartment with a Housing Choice Voucher and is also saving to buy. Her rent share and her annual recertification go through the city's housing authority, not through a HUD office. When a landlord refuses to show her a unit once she mentions the voucher and her two children, her familial-status complaint goes to HUD under the Fair Housing Act, and she has one year to file it. When she is ready to buy, a HUD-approved counselor can walk her through an FHA loan, which she will take out with a private lender.

HUD is a federal department rather than a product, so what follows is what its structure means for a household.

What the structure gives

• FHA insurance lets private lenders accept smaller down payments and weaker credit than they otherwise would, which widens access to homeownership.
• A federal complaint route for housing discrimination with a statutory one-year window and a choice of forums.
• A national certification standard for housing counseling agencies, so a "HUD-approved" counselor has met a defined test.
• One federal construction code for manufactured homes in place of varying local building codes.

What the structure does not give

• HUD is rarely the direct point of contact. Lenders, servicers and local housing agencies apply its rules, and the experience varies with them.
• Rental assistance depends on local agencies and their waiting lists, so eligibility does not guarantee assistance.
• HUD does not supervise Fannie Mae or Freddie Mac and no longer writes RESPA rules, so many mortgage questions belong to another agency.
• Program rules change through handbooks and notices as well as regulations, so a rule described in an older document may no longer apply.