Each year the Federal Housing Administration, which insures mortgages made by local lenders, estimates the number of defaults it will likely experience. Based on this prediction, it sets the insurance premium buyers will pay during that year.

If fewer defaults than predicted actually occur, those borrowers that have continued to pay on their mortgages are eligible to share in the leftover funds. Rules governing the eligibility for premium refunds and distributive share payments are subject to change and there is a statute of limitations on some types of claims, so prompt action is required.

Mortgage companies are supposed to notify the Department of Housing and Urban Development (HUD) when insurance is terminated, but often don't. Furthermore, because you would likely have a different address than the one on file at HUD, refund checks often are returned as undeliverable.

If you believe you may be entitled to a refund but were not notified, go to: HUD Refund Search