Several of the Federal Housing Administration's multifamily mortgage insurance programs have experienced high rates of default, assignment, and foreclosure, which have resulted in drains on HUD's insurance funds. This failure experience raises two broad policy issues. First, how can FHA's underwriting and production processes be modified to reduce the number of unviable projects constructed; and second, once a pr01ect begins to experience serious problems, what management tools are available to minimize loss to the federal government. Consideration of these policy issues requires a thorough understanding of the factors that cause multifamily projects to fail.