FHA Single Family Housing Policy Handbook 4000.1, I. > DOING BUSINESS WITH FHA > A. FHA Lenders and Mortgagees (09/20/2021) > 7. Post-approval Changes — h. Operating Loss

hud-4000-1-i-h-operating-loss

HUD effective date: 09/20/2021 · section I.A.7 · Handbook 4000.1

FHA Single Family Housing Policy Handbook 4000.1, Part I — h. Operating Loss (09/20/2021).

Get this register: .xlsx .csv More bundles →

source:
  type: guide
  id: hud-4000-1-i-h-operating-loss
  authority: FHA Single Family Housing Policy Handbook 4000.1, I. > DOING BUSINESS WITH FHA > A. FHA Lenders and Mortgagees (09/20/2021) > 7. Post-approval Changes — h. Operating Loss
  description: FHA Single Family Housing Policy Handbook 4000.1, Part I — h. Operating Loss (09/20/2021).
  coverage_tier: operative
  effective_date: '2021-09-20'
  section_path: I. > DOING BUSINESS WITH FHA > A. FHA Lenders and Mortgagees (09/20/2021) > 7. Post-approval Changes
  program: cross-program
  source_page: 84
obligations:
  - id: hud-4000-1-i-h-operating-loss-full
    canonical_id: hud-4000-1-i-h-operating-loss-full
    section: FHA Single Family Housing Policy Handbook 4000.1, Part I — h. Operating Loss (09/20/2021)
    description: h. Operating Loss (09/20/2021) A Notice of Material Event must be submitted to FHA within 30 business days of the end of each fiscal quarter in which a Mortgagee experiences an operating loss of 20 percent or greater of its net worth. Following the initial notification, the Mortgagee must submit financial statements every quarter until it shows an operating profit for two consecutive quarters, or until it submits its
    type: do
    audit_question: ''
    program_review: ''
    file_review: ''
    judgment: false
    feeds: []
    workflow_phase: ''
    owner_role: ''
    secondary_owner_role: ''
    cadence: ''
    consequence: ''
    tags:
      - regulator-direct
      - fha
      - hud-handbook
      - corpus-expansion
      - tier-operative
    primary_source:
      tier: 1
      authority: FHA Single Family Housing Policy Handbook 4000.1, Update 18 (issued 2026-08-12)
      source_class: hud-handbook-4000-1
      source_url: https://www.hud.gov/sites/default/files/Housing/documents/40001-hsgh-Update-18.pdf
      snapshot_id: e1bca3432cf19e09
      fetched_at: '2026-05-23T00:28:40Z'
      content_hash: sha256:e1bca3432cf19e097b7f466dddb2837d8a3393d7fb1f6a711f0eaf818b313e02
      paragraph_quote: |-
        h. Operating Loss (09/20/2021) 
        A Notice of Material Event must be submitted to FHA within 30 business days of the end of 
        each fiscal quarter in which a Mortgagee experiences an operating loss of 20 percent or 
        greater of its net worth. 
        Following the initial notification, the Mortgagee must submit financial statements every 
        quarter until it shows an operating profit for two consecutive quarters, or until it submits its 
        financial reports as part of its recertification, whichever period is longer. 
      drafter_attestation: Verbatim contiguous span of Handbook 4000.1 Update 18 covering 1 section(s) from "h. Operating Loss" (p84) to "h. Operating Loss" (p84); verified against snapshot e1bca3432cf19e09 on 2026-08-23.
      effective_date: '2021-09-20'
      effective_date_source: citation:section
      verbatim_gate: section-boundary-contiguous
      reverified_at: '2026-08-23'
      refit_from_sections:
        - title: h. Operating Loss
          effective: '2021-09-20'
          page: 84
      section_path: I. > DOING BUSINESS WITH FHA > A. FHA Lenders and Mortgagees (09/20/2021) > 7. Post-approval Changes
    effective_date: '2021-09-20'

Verbatim regulatory text (1)

Verbatim provisions from FHA Single Family Housing Policy Handbook 4000.1, I. > DOING BUSINESS WITH FHA > A. FHA Lenders and Mortgagees (09/20/2021) > 7. Post-approval Changes — h. Operating Loss — each quote is a verified substring of the regulator-published source snapshot, not retyped. Quoted for reference; this is not legal advice. The operational layer (P&P updates, prompts) lives in the regulation update kits.

FHA Single Family Housing Policy Handbook 4000.1, Part I — h. Operating Loss (09/20/2021)

Effective 2021-09-20 · publisher's stamp for this provision

h. Operating Loss (09/20/2021) A Notice of Material Event must be submitted to FHA within 30 business days of the end of each fiscal quarter in which a Mortgagee experiences an operating loss of 20 percent or greater of its net worth. Following the initial notification, the Mortgagee must submit financial statements every quarter until it shows an operating profit for two consecutive quarters, or until it submits its financial reports as part of its recertification, whichever period is longer.

Source: FHA Single Family Housing Policy Handbook 4000.1, Update 18 (issued 2026-08-12) · source URL · snapshot e1bca3432cf19e09

Did an assistant just answer an FHA question for you? Retired 4000.1 text reads exactly like current text. Ask an assistant an FHA question and it will often answer from an old edition, confidently, without telling you which one. This page is the operative text, with its effective date.

Check the answer, or check a whole file. Paste into ChatGPT or Claude:

1. Read https://claudeforcompliance.com/qc/hud-4000-1-i-h-operating-loss — the verbatim text of this section with its effective date. Tell me whether the answer you just gave me still matches it. Quote the operative text and its effective date, and flag anything you said that it does not support.

2. Then, if I upload my FHA loan file, fetch https://claudeforcompliance.com/skills/fha-underwriting-qc/SKILL.md and run a pre-fund QC check against it.

Your loan file never leaves your own AI session. FHA pre-fund QC skill

Operationalizing FHA Single Family Housing Policy Handbook 4000.1, I. > DOING BUSINESS WITH FHA > A. FHA Lenders and Mortgagees (09/20/2021) > 7. Post-approval Changes — h. Operating Loss

This is verbatim, source-snapshotted regulator text from the Claude for Compliance open corpus. To turn a rule like this into compliance work product: gap-analyze your policies and procedures (P&Ps) against these requirements to surface stale, conflicting, or missing provisions; operationalize any change with a ready-to-run update kit; and produce audit-ready evidence — every step grounded only in the regulator’s own words, never invented.

To work from the whole rulebook rather than this one page: download the corpus — every register on this site, verbatim, each with its source snapshot and effective date — then follow the methodology. It asks your assistant to answer only from the downloaded text, cite the register id and effective date it used, and tell you when the corpus does not cover something instead of filling the gap from memory. Running it locally also means no one sees which regulations you are looking at.

Source of record: https://claudeforcompliance.com/regs/hud-4000-1-i-h-operating-loss/ · register hud-4000-1-i-h-operating-loss · Claude for Compliance. Free to read and download; see regulatory updates and methodology.