Hank Investigates: HUD Money

Hank Phillippi Ryan
"Did you know you had money coming to you?"

Jackie Beard
"No. I wasn't aware at all."

We found this Dracut mother is owed $2,600!

Debbie Thomas
"I'm sure other people are owed money too."

She's right! Our investigation found the U.S. Department of Housing and Urban Development owes this list of homebuyers a total of $90 million. Some of those people like the man who owned this Fitchburg home, wonder why they didn't hear about it from the Feds. We found he's owed 1400 dollars!

Donald Gray
"If we've got money we should be able to get it."

Don and these 120,000 others are owed money because they overpaid mortgage insurance on federal home loans. It's HUD's job to return those millions. Matt Franklin is deputy secretary.

Matt Franklin, HUD
"We are real proud of our refund program."

HUD'S program, a computerized mailing system, sends at least three notification letters like these to homeowners due refunds. It does pay 350,000 people a year.

Matt Franklin, HUD
"The goal is to get the refunds in the hands of folks."

But we obtained this list of tens of thousands of people still owed refunds---hundreds in New England alone! And many told us that they've never heard from HUD.

Jackie Beard
"I received no information or notification from the government that I had HUD money due to me."

Debbie Thomas
"I don't think someone is doing their job."

Donald Gray
"There's something wrong with the system."

HUD says the system works fine.

Hank
"People are frustrated they've never heard from HUD what can you tell them?"

Matt Franklin
"What I would tell them Hank is that we are working hard to locate folks."

But, we discovered, not as hard as they might. We notified dozens of people on the refund list just by using a common internet phone directory and calling them. It was a snap! We found Jackie in one phone call.

Hank
"We found you. Why do you think the government can't find you?

Jackie
"I don't know."

Debbie was one phone call too.

Debbie Thomas
"I've lived in the same house since I bought it back in 1996. The same address."

But HUD sticks to the mail.

Hank
"Do you ever just call them?"

Matt
"We have been doing this by written correspondence."

Hank
"So you don't call?"

Matt
"That's not part our procedure, no."

As a result, our investigation found, some people have discovered how to profit from the system's failure. Looking at these letters, Don Gray got hundreds of them. "United States Housing Refund Notification", one says, with a big seal and "final notice" in bold print.

Don Gray
"It looks like it's from the U.S. government."

The letters say, "the U.S. government is holding your money" so just sign this contract and we'll claim it for a percentage. Problem is that these "tracer agencies" are not connected with the US government. They're just businesses, who buy HUD's refund mailing list and send these letters hoping to get people to pay for something that's free. What's more, when Don sent in $280 his tracer took the fee and took off.

Don Gray
"I think the tracers must be a rip-off."

Federal officials agree, three years ago at this news conference they promised to crack down on tracers posing as government officials, but we found on the web and in the mail there's still a thriving industry designed just to cash-in where the government misses out.

Debbie
"Shame on the government for not trying a little bit harder."

HUD officials can show you how to get your money. It takes about 120 days and remember if you do have money coming to you, you don't have to pay anyone to help you get it.

To find out if HUD owes you money, check HUD's website or call 1-800-697-6967.