[Federal Register Volume 88, Number 132 (Wednesday, July 12, 2023)]
[Notices]
[Pages 44386-44389]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-14790]


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DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

[Docket No. FR-7077-N-12]


Privacy Act of 1974; System of Records

AGENCY: Office of Housing, Office of Single-Family Program Development, 
HUD.

ACTION: Notice of an amendment to system of records.

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SUMMARY: Under the Privacy Act of 1974, as amended, the Department of 
Housing and Urban Development (HUD), Office of Single-Family Program 
Development is issuing a public notice of its intent to amend the 
system of records for: Computerized Homes Underwriting Management 
System (CHUMS)/Loan Application Management System (LAMS). This notice 
includes a section detailing Federal Housing Administration (FHA) 
Connection (FHAC), which was described under CHUMS in the 2016 notice. 
The amendment makes updates to the system of records name, location and 
system manager, authority, purpose, categories of individuals, 
categories of records in the system, record source categories, routine 
uses, policies and practices for storage and retrieval of records, 
policies and practices for retention and disposal of records, 
safeguards, record access and contesting procedures and notification 
procedures. The updates are explained in the ``Supplementary Section'' 
of this notice. The existing scope, objectives, business processes, and 
uses remain unchanged.

DATES: Comments will be accepted on or before August 11, 2023. The SORN 
becomes effective immediately, while the routine uses become effective 
after the comment period immediately upon publication except for the 
routine uses, which will become effective on the date following the end 
of the comment period unless comments are received which result in a 
contrary determination.

ADDRESSES: You may submit comments, identified by docket number or by 
one of the following methods:
    Federal e-Rulemaking Portal: http://www.regulations.gov. Follow the 
instructions provided on that site to submit comments electronically.
    Fax: 202-619-8365.
    Email: [email protected].
    Mail: Attention: Privacy Office; Mr. LaDonne White, Chief Privacy 
Officer; Office of the Executive Secretariat; 451 Seventh Street SW, 
Room 10139; Washington, DC 20410-0001.
    Instructions: All submissions received must include the agency name 
and docket number for this rulemaking. All comments received will be 
posted without change to http://www.regulations.gov. including any 
personal information provided.
    Docket: For access to the docket to read background documents or 
comments received go to http://www.regulations.gov.

FOR FURTHER INFORMATION CONTACT: Mr. LaDonne White; 451 Seventh Street 
SW, Room 10139, Washington, DC 20410-0001, telephone number (202) 708-
3054 (this is not a toll-free number). HUD welcomes and is prepared to 
receive calls from individuals who are deaf or hard of hearing, as well 
as individuals with speech or communication disabilities. To learn more 
about how to make an accessible telephone call, please visit https://www.fcc.gov/consumers/guides/telecommunications-relay-service-trs.

SUPPLEMENTARY INFORMATION: HUD amends system of records notice (SORN) 
for the Computerized Homes Underwriting Management System (CHUMS)/Loan 
Application Management System (LAMS) and Federal Housing Administration 
(FHA) Connection (FHAC), to include these substantive changes 
reflecting the new and modified items listed below and administrative 
updates to regulatory references along with word and format changes 
throughout the SORN.
    i. System Name and Number: Updated to Single Family Mortgage 
Insurance Origination System which includes FHA Connection (FHAC), 
which was previously described as a subsystem of CHUMS without the 
detail provided in this update.
    ii. System Location: Updated to reflect the current locations of 
CHUMS which migrated from a legacy mainframe environment to Microsoft 
Azure Federal Cloud service environment.
    iii. Authority For Maintenance of the System: Updated to include 
additional citations for the legal authority for HUD to collect Social 
Security Numbers, which were inadvertently omitted from the previous 
SORN.
    iv. Purpose(s) of the System: Updated to include more details about 
FHAC as a sub-system of CHUMS.
    v. Categories of Individuals Covered by the System: Updated to 
reflect records collected from System Users in FHAC, as well as 
Borrowers and Appraisers in LAMS.
    vi. Categories of Records in the System: Updated to detail the 
categories of records in FHAC, CHUMS and LAMS.
    vii. Record Source Categories: Updated to clarify HUD does not 
collect records in FHAC, CHUMS or LAMS directly from borrowers.
    viii. Routine Uses of Records Maintained in the System, Including 
Categories of Users and Purposes of Such Uses: The routine uses in the 
previous SORN were numbered. In this update, they are listed by letter. 
Item (1) was removed as obsolete. Items (4) and (5) were consolidated 
into single routine use since they are related to the Department of 
Justice. Item (7) is being split in two to clarify that the use related 
to Technology Open to Approved Lenders (TOTAL) Scorecard

[[Page 44387]]

and the National Mortgage Database (NMDB) are separate from the routine 
use for research and risk management activities related to automated 
underwriting systems (AUSs) and credit standards. Item (11) was 
erroneously included in the last SORN and is therefore being deleted. 
Item (12) is being revised to include all public rosters within CHUMS, 
not just housing counseling agencies.
    Two new Routine Uses are being added. The first new Routine Use 
(new item L) is specific to CHUMS data and covers a new Computer 
Matching Agreement (CMA) with the Social Security Administration that 
includes verification of SSNs and other user data for security 
purposes.
    The second new Routine Use (new item O) is specific to LAMS and 
covers data sharing with Federal financial regulators, Fair Lending 
enforcement agencies, and financial institutions for analysis and 
research to assess program compliance and risks associated with real 
estate appraisal and other property valuation methods used in Federal 
housing finance transactions. Recipients may use the data, including 
analysis and research, in conducting investigations and taking 
enforcement action (including cases and administrative proceedings) for 
violations of laws, rules or regulations, and for coordinated policy 
development and implementation.
    Routine Uses (A) through (K) apply to data found in FHAC, CHUMS and 
LAMS. Routine Uses (L) through (N) apply specifically to CHUMS data, 
and Routine Use (O) applies specifically to LAMS data.
    ix. Policies and Practices for Storage of Records: Updated to 
remove reference to paper records. The systems only contain electronic 
records.
    x. Policies and Practices for Retrieval of Records: Removed the 
reference to paper records and replaced ``other identification number'' 
with ``HUD Roster ID number.'' Added Appraiser Roster ID and 203k 
Consultant Roster ID.
    xi. Policies and Practices for Retention and Disposal of Records: 
Edited to simplify and make more concise.
    xii. Administrative, Technical, and Physical Safeguards: Updated to 
reflect the current operating environment for CHUMS in the MS Azure 
Federal Cloud.

SYSTEM NAME AND NUMBER:
    Single Family Mortgage Insurance Origination System. HUD/HSNG.03.

SECURITY CLASSIFICATION:
    Unclassified.

SYSTEM LOCATIONS:
    The core CHUMS system is in the Microsoft Azure Federal Cloud US 
East, One Microsoft Way, Redmond, Washington, 98052-6399. FHAC and LAMS 
are located and backed up on servers housed at the National Center for 
Critical Information Processing and Storage located at NASA's Shared 
Services Center, Building 1111, Stennis Space Center, MS 39529-6000.

SYSTEMS MANAGER:
    Elissa Saunders, Director, Office of Single-Family Program 
Development, HUD Headquarters; 451 7th ST SW, Room 9278, Washington, DC 
20410-0001. (202) 402-2378; [email protected].

AUTHORITY FOR MAINTENANCE OF THE SYSTEMS:
    Title I, Section 2 of the National Housing Act (12 U.S.C. 1703). 
Section 202 of the National Housing Act (12 U.S.C. 1708). Section 203 
of the National Housing Act (12 U.S.C. 1709). Section 255 of the 
National Housing Act (12 U.S.C. 1715z-20). 31 U.S.C. 7701 r. 42 U.S.C. 
3543 and 24 CFR part 200, subpart U and 24 CFR 203.35.

PURPOSES OF THE SYSTEMS:
    Federal Housing Administration (FHA) Connection (FHAC) is 
integrated with HUD's security infrastructure to assign user roles and 
permissions based on business need. FHAC's function as a security and 
access management portal includes web pages to collect first and last 
names, Social Security Numbers (SSNs), dates of birth (DOB), mother's 
maiden name, work telephone number and email address. All data 
collected by FHAC for security and access management is stored in 
Computerized Homes Underwriting Management System (CHUMS).
    CHUMS supports HUD and its approved business partners with 
processing and underwriting applications for single-family mortgages 
insurance under the National Housing Act. CHUMS provides functionality 
to track and process cases and manages workloads for HUD field office 
management. CHUMS functionality enables lenders and HUD in determining 
eligibility for participation in HUD's single family mortgage insurance 
program and lets lenders use Automated Underwriting Systems (AUS) 
provided by mortgage financial institutions by granting authorized AUS 
providers access to FHA's Technology Open to Approved Lenders (TOTAL) 
Scorecard.
    Loan Application Management System (LAMS) supports the Federal 
Housing Administration (FHA) mortgage insurance program by providing 
automated processing, analysis, and screening of appraisal 
documentation. LAMS receives and stores appraisal data from the 
Electronic Appraisal Delivery (EAD) portal in a Mortgage Industry 
Standards Maintenance Organization (MISMO) Extensible Markup Language 
(XML) format tailored to HUD specifications. LAMS passes certain data 
elements onto FHAC and CHUMS to ensure data integrity and provides 
valuable time savings to lenders by reducing the burden of paper-based 
delivery and manual data entry processes.

CATEGORIES OF INDIVIDUALS COVERED BY THE SYSTEMS:
    System Users, HUD business partners (appraisers, inspectors, 
mortgagee staff underwriters), HUD employees, Mortgagors (Borrowers), 
Individuals who applied for a mortgage insured under HUD/FHA's single 
family mortgage insurance programs, including Home Equity Conversion 
Mortgages (HECM) Non-Borrowing Spouses, Appraisers (both applicants and 
Appraisers listed on the HUD Appraiser Roster), 203k Consultants (both 
applicants and 203k Consultants listed on the HUD 203k Consultant 
Roster), Mortgagee (Lender) Staff including, but not limited to, loan 
originators, appraisers, underwriters, processors and file clerks, 
Individuals registering for access to the HUD Housing Counselor 
Certification Examination, whether or not they become certified, 
Individuals registering for HUD Certified Housing Counselor 
certification or housing counseling clients receiving housing 
counseling from an agency participating in HUD's Housing Counseling 
Clients.

CATEGORIES OF RECORDS IN THE SYSTEMS:
    Full name, Social Security Number (SSN), IRS Employer 
Identification Number (EIN), Appraiser Roster ID number, 203k 
Consultant ID number, License Number, Date of Birth (DOB), mother's 
maiden name, home and/or work telephone number, email address, mailing 
address (home and/or work) and Agency or organization affiliation, 
Lender ID, racial/ethnic background (if disclosed), sex (if disclosed), 
credit scores (FICO[supreg] scores), Non-borrowing Spouse status (HECM 
loans only), mortgage loan terms, including documents used by the 
lender when underwriting the loan (including, but not limited to 
paystubs, bank statements, tax returns), Appraiser's license/expiration 
date, and address, email address, demographic data, Minority Business 
Enterprise (MBE) Code, 203K Consultant ID number, 203K

[[Page 44388]]

license number (if applicable), Roster termination date for Appraisers, 
203k Consultants, Housing Counselors), business territory/participation 
state, Nationwide Mortgage Licensing System (NMLS) number, transaction 
history and/or workload of the individuals using the system, Housing 
Counseling System (HCS) number, preferred language, and subject 
property addresses.

ROUTINE USES OF RECORDS MAINTAINED IN THE SYSTEM, INCLUDING CATEGORIES 
OF USERS AND PURPOSES OF SUCH USES:
    A. To appropriate agencies, entities, and persons when: (a) HUD 
suspects or has confirmed that there has been a breach of the system of 
records; (b) HUD has determined that as a result of the suspected or 
confirmed breach there is a risk of harm to individuals, HUD (including 
its information systems, programs, and operations), the Federal 
Government, or national security; 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 
breach or to prevent, minimize, or remedy such harm.
    B. To another Federal agency or Federal entity, when HUD determines 
that information from this system of record is reasonably necessary to 
assist the recipient agency or entity in (a) responding to a suspected 
or confirmed breach or (b) preventing, minimizing, or remedying the 
risk of harm to individuals, the recipient agency or entity (including 
its information systems, programs, and operations), the Federal 
government, or national security resulting from a suspected or 
confirmed breach.
    C. To a congressional office from the record of an individual in 
response to an inquiry from that congressional office made at the 
request of the individual to whom the record pertains.
    D. To the General Accounting Office (GAO) for audit purposes.
    E. To contractors, grantees, experts, consultants, and the agents 
thereof, and others performing or working on a contract, service, 
grant, cooperative agreement, or other agreement with HUD, when 
necessary to accomplish an agency function related to these systems of 
records, limited to only those data elements considered relevant to 
accomplishing an agency function.
    F. To the general public through rosters maintained and published 
by HUD to look up Appraisers, 203k Consultants, Housing Counselors, and 
HECM Counselors. The information will be released to any interested 
person only through a specific web page on either www.hud.gov or the 
HUD Exchange designated by HUD. Such disclosures are limited to name, 
contact information, licensing, and certification status.
    G. To Federal agencies, non-Federal entities, their employees, and 
agents (including contractors, their agents or employees; employees or 
contractors of the agents or designated agents); or contractors, their 
employees or agents with whom HUD has a contract, service agreement, 
grant, cooperative agreement, or computer matching agreement for: (a) 
detection, prevention, and recovery of improper payments; (b) detection 
and prevention of fraud, waste, and abuse in major Federal programs 
administered by a Federal agency or non-Federal entity; (c) detection 
of fraud, waste, and abuse by individuals in their operations and 
programs; d) for the purpose of establishing or verifying the 
eligibility of, or continuing compliance with statutory and regulatory 
requirements by, applicants for, recipients or beneficiaries of, 
participants in, or providers of services with respect to, cash or in-
kind assistance or payments under Federal benefits programs or 
recouping payments or delinquent debts under such Federal benefits 
programs. Records under this routine use may be disclosed only to the 
extent that the information shared is necessary and relevant to verify 
pre-award and pre-payment requirements prior to the release of Federal 
funds, or to prevent and recover improper payments for services 
rendered under programs of HUD or of those Federal agencies and non-
Federal entities to which HUD provides information under this routine 
use.
    H. To Federal agencies, and non-Federal entities, including, but 
not limited to contractors, grantees, experts, consultants, State and 
local governments and other research institutions or their parties, and 
entities and their agents with whom HUD has a contract, service 
agreement, grant, cooperative agreement, or other agreement, for the 
purposes of analysis and research to support program operations, 
management, performance monitoring, evaluation, risk management, and 
policy development, or to otherwise support the Department's mission. 
Records under this routine use may not be used in whole or in part to 
make decisions that affect the rights, benefits, or privileges of 
specific individuals. The results of the matched information may not be 
disclosed in identifiable form.
    I. To appropriate Federal, State, local, tribal, or other 
governmental agencies or multilateral governmental organizations 
responsible for investigating or prosecuting the violations of, or for 
enforcing or implementing, a statute, rule, regulation, order, or 
license, where HUD determines that the information would help in the 
enforcement of civil or criminal laws and when such records, either 
alone or in conjunction with other information, indicate a violation or 
potential violation of law.
    J. To a court, magistrate, administrative tribunal, or arbitrator 
in the course of presenting evidence, including disclosures to opposing 
counsel or witnesses in civil discovery, litigation, mediation, or 
settlement negotiations; or in connection with criminal law 
proceedings; when HUD determines that use of such records is relevant 
and necessary to the litigation and when any of the following is a 
party to the litigation or have an interest in such litigation: (a) 
HUD, or any component thereof; or (b) any HUD employee in his or her 
official capacity; or (c) any HUD employee in his or her individual 
capacity where HUD has agreed to represent the employee; or (d) the 
United States, or any agency thereof, where HUD determines that 
litigation is likely to affect HUD or any of its components.
    K. To any component of the Department of Justice or other Federal 
agency conducting litigation or in proceedings before any court, 
adjudicative, or administrative body, when HUD determines that the use 
of such records is relevant and necessary to the litigation and when 
any of the following is a party to the litigation or have an interest 
in such litigation: (a) HUD, or any component thereof; or (b) any HUD 
employee in his or her official capacity; or (c) any HUD employee in 
his or her individual capacity where the Department of Justice or 
agency conducting the litigation has agreed to represent the employee; 
or (d) the United States, or any agency thereof, where HUD determines 
that litigation is likely to affect HUD or any of its components.
    L. To the Social Security Administration through a computer 
matching program to verify the eligibility of program participants and 
applicants in FHA's housing finance programs. (This use is specific to 
CHUMS data.)
    M. To HUD authorized AUS providers and software companies involved 
in providing access to TOTAL Scorecard including, but not limited to, 
Government Sponsored Enterprises (GSEs) Fannie Mae and Freddie Mac,

[[Page 44389]]

financial institutions and software companies to respond to requests 
for assistance with individual cases submitted to TOTAL Scorecard and 
for the purposes of research and analysis to enhance program operations 
and performance through automated underwriting, credit scoring and risk 
management. PII data used for research and analysis including the 
results of the research and analysis must be de-identified and 
aggregated and may not be disclosed or published. (This use is specific 
to CHUMS data.)
    N. To other Federal agencies, (including but not limited to the 
Federal Housing Finance Agency (FHFA) and the Consumer Financial 
Protection Bureau), and their contractor/s through data sharing and 
other agreements for the purposes of research and analysis of automated 
underwriting, credit enhance oversight of the mortgage market, inform 
rulemaking, assess program effectiveness, and to publish de-identified 
aggregate data and results of research and analysis. (This use is 
specific to CHUMS data.)
    O. To Federal financial regulators, Fair Lending enforcement 
agencies, and financial institutions (including, but not limited to the 
Federal Housing Finance Agency (FHFA), Government Sponsored Enterprises 
(GSEs) Fannie Mae and Freddie Mac, Veterans Administration, US 
Department of Agriculture Rural Development Agency, Consumer Financial 
Protection Bureau, the Federal Reserve, and the Appraisal Subcommittee) 
through data sharing agreements and other agreements for the purposes 
of analysis and research to assess program compliance and risks 
associated with real estate appraisal and other property valuation 
methods used in Federal housing finance transactions. Recipients may 
use the data, including analysis and research, in conducting 
investigations and taking enforcement action (including cases and 
administrative proceedings) for violations of laws, rules, or 
regulations, and for coordinated policy development and implementation. 
(This routine use is specific to LAMS data.)

POLICIES AND PRACTICES FOR STORAGE OF RECORDS:
    Electronic only.

POLICIES AND PRACTICES FOR RETRIEVAL OF RECORDS:
    Records are retrieved by Name and Social Security Number.

POLICIES AND PRACTICES FOR RETENTION AND DISPOSAL OF RECORDS:
    Per HUD Schedule Appendix 20 Single Family Home Mortgage Insurance 
Program Records, item 13B6, and HUD Schedule Appendix 5, Technical 
Support Records, all records in FHAC, CHUMS and LAMS will be destroyed 
when superseded or obsolete. Per General Record Schedule 5.2, Item 20, 
all FHAC, CHUMS and LAMS records are temporary and are to be destroyed 
upon verification of successful creation of the final document or file, 
or when no longer needed for business use, whichever is later.

ADMINISTRATIVE, TECHNICAL, AND PHYSICAL SAFEGUARDS:
    Administrative Safeguards: The core CHUMS system and all data are 
maintained simultaneously across multiple data centers within the 
Microsoft Azure Federal cloud, which are located within FedRAMP 
security approved facilities. For technical reasons, certain CHUMS 
databases, FHAC and LAMS are located and backed up on servers housed 
within secure Federal data facilities and not in the cloud.
    Physical Safeguards: Controls to secure the data and protect 
electronic records, buildings, and related infrastructure against 
threats associated with their physical environment include, but are not 
limited to, using cypher and combination locks, key card-controlled 
access, security guards, closed circuit TV, identification badges, and 
safes. Administrative controls include encryption of back-up data, 
back-ups secured off-site, methods to ensure only authorized users have 
access to PII, periodic security audits, regular monitoring of system 
users' behavior and users' Security Practices.
    Technical Safeguards: Controls for the systems include, but are not 
limited to, encryption of Data at Rest and in Transit, firewalls at 
HUD, user ID, password protection, role-based access controls, Least 
Privileged access, elevated and/or administrative privileged access, 
Personal Identify Verification cards, intrusion detection systems. 
Unauthorized access is controlled by application-level security.

RECORD ACCESS PROCEDURES:
    Individuals requesting records of themselves should address written 
inquiries to the Department of Housing Urban and Development 451 7th 
Street SW, Washington, DC 20410-0001. For verification, individuals 
should provide their full name, current address, and telephone number. 
In addition, the requester must provide either a notarized statement or 
an unsworn declaration made under 24 CFR 16.4.

CONTESTING RECORD PROCEDURES:
    The HUD rules for accessing, contesting, and appealing agency 
determinations by the individual concerned are published in 24 CFR part 
16.8 or may be obtained from the system manager.

NOTIFICATION PROCEDURES:
    Individuals requesting notification of records of themselves should 
address written inquiries to the Department of Housing Urban 
Development, 451 7th Street SW, Washington, DC 20410-0001. For 
verification purposes, individuals should provide their full name, 
office or organization where assigned, if applicable, and current 
address and telephone number. In addition, the requester must provide 
either a notarized statement or an unsworn declaration made under 24 
CFR 16.4.

EXEMPTIONS PROMULGATED FOR THE SYSTEM:
    None.

HISTORY:
    Docket No. FR-5921-N-17, 81-FR-71750, October 18, 2016.

LaDonne White,
Chief Privacy Officer, Office of Administration.
[FR Doc. 2023-14790 Filed 7-11-23; 8:45 am]
BILLING CODE 4210-67-P