The large number of financial institutions seeking a Federal Housing Administration license has created a backlog of applications at the Department of Housing and Urban Development. If an application is approved as submitted, it is not uncommon for institutions to wait two to three months to receive the approval.

Further requests for information or disapproval of an initial application can add another month or more to the processing time. Many institutions applying for the licenses are doing so for the first time and are unaware of the FHA's specific program requirements. As a result, they may submit applications that contain erroneous or incomplete information, slowing down the approval process.

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