HUD Recovery Fee?

[Bernard Chouinard]

Someone I'm talking to had a brother who died in 2014 who had a HUD loan. His brother was telling me he only owed $15K on the house however HUD wants $96K in Recovery fees.

Does anyone know what this is? In talking to a few RE Agents we're thinking it might have something to do with HUD paying for all of the property taxes. The HUD agent this guy is working with will not budge on allowing anything less thant he $96K. The house needs a total flip, updated septic and well. At best ARV would be around $160-180K. Small 960 Sqft 3/1 house but part of a dead end private association with access to a private beach (lake).

Non the less, anyone ever heard of this before?  Any ideas on how to go around it?