Correct the programming error in the HERMIT system to ensure that the correct insurance-in-force balances are reported on the note disclosures.
2020-FO-0001 | Noviembre 14, 2019
Fiscal Years 2019 and 2018 Financial Statements Audit
Housing
- Status2020-FO-0001-001-DOpenClosed
- Status2020-FO-0001-001-EOpenClosed
Develop policies and procedures to ensure that the line items in the required note disclosures are understood, properly calculated, and properly disclosed in the financial statements in accordance with OMB Circular A-136.
2019-KC-0003 | Septiembre 30, 2019
FHA Insured at Least $13 Billion in Loans to Ineligible Borrowers With Delinquent Federal Tax Debt
Housing
- Status2019-KC-0003-001-AOpenClosed$6,130,757,970Funds Put to Better Use
Recommendations that funds be put to better use estimate funds that could be used more efficiently. For example, recommendations that funds be put to better use could result in reductions in spending, deobligation of funds, or avoidance of unnecessary spending.
PrioridadPriorityWe believe these open recommendations, if implemented, will have the greatest impact on helping HUD achieve its mission to create strong, sustainable, inclusive communities and quality affordable homes for all.
Require lenders to obtain the borrowers’ consent to verify the existence of delinquent Federal taxes with the IRS during loan origination and deny any applicant with delinquent Federal tax debt and no payment plan or a noncompliant payment plan or an applicant refusing to provide consent from receiving FHA insurance to put at least $6.1 billion to better use by avoiding potential future costs to the FHA insurance fund.
Status
As of October 2023, the Office of Single Family Housing reported it will need additional tax information from the Internal Revenue Service to complete the planned action, and that the Office of the Chief Financial Officer will assist the Office of Single Family Housing. As of June 2024, no new update has been reported.
The final action target date was May 23, 2024, but was updated in June 2024 to May 23, 2025.
Analysis
To fully address this recommendation, HUD will need to provide evidence that it established a method of borrower consent to verify the existence of delinquent federal taxes.
Implementation of this rule should result in HUD putting $6.1 billion to better use.
- Status2019-KC-0003-001-BOpenClosed
Revise HUD handbooks for forward and reverse mortgages to reflect that tax liens and judgments are no longer reported on credit reports.
- Status2019-KC-0003-001-COpenClosed
Revise HUD handbooks for forward and reverse mortgages for uniformity in the treatment of delinquent tax debt and the existence of payment plans as only the forward mortgage handbook requires 3 months of payments.
2019-BO-1004 | Septiembre 09, 2019
Tuscan Homes I and II in Hartford, CT, Was Not Always Managed in Accordance With Its Regulatory Agreement and HUD Requirements
Housing
- Status2019-BO-1004-001-AOpenClosed$17,761Questioned Costs
Recommendations with questioned costs identify costs: (A) resulting from an alleged violation of a law, regulation, contract, grant, or other document or agreement governing the use of Federal funds; (B) that are not supported by adequate documentation (also known as an unsupported cost); or (C) that appear unnecessary or unreasonable.
Reimburse the project $17,761 from nonproject funds for the project operating funds disbursed for ineligible expenses.
- Status2019-BO-1004-001-BOpenClosed$17,653Questioned Costs
Recommendations with questioned costs identify costs: (A) resulting from an alleged violation of a law, regulation, contract, grant, or other document or agreement governing the use of Federal funds; (B) that are not supported by adequate documentation (also known as an unsupported cost); or (C) that appear unnecessary or unreasonable.
Support or reimburse the project $17,653 from nonproject funds for the project operating funds disbursed without sufficient supporting documentation.
- Status2019-BO-1004-001-COpenClosed$45,000Funds Put to Better Use
Recommendations that funds be put to better use estimate funds that could be used more efficiently. For example, recommendations that funds be put to better use could result in reductions in spending, deobligation of funds, or avoidance of unnecessary spending.
Reclassify and properly record $45,000 in owner advances misclassified as loans.
- Status2019-BO-1004-001-DOpenClosed
Strengthen controls to ensure that project advances are reimbursed only when the project is in a surplus-cash position.
- Status2019-BO-1004-001-EOpenClosed
Implement adequate controls to ensure the review of the management agent fee to ensure that it is properly calculated in accordance with the HUD management agent certification and approved prior to payment from project operating funds.
- Status2019-BO-1004-001-FOpenClosed
Implement adequate controls to ensure that project funds are used only for eligible and supported operating expenses.
- Status2019-BO-1004-001-GOpenClosed
Obtain a formal agreement and approval from HUD to specify who is authorized to use the project’s community and recreation rooms and what activities are authorized or prohibited. In addition, this agreement must ensure that sufficient legal and liability protections are in place, establish consequences for noncompliance, and determine who is to pay for the utilities and maintenance of the rooms.
- Status2019-BO-1004-001-HOpenClosed
Amend the management agent agreement compensation schedule to remove bookkeeping fees as a fee separate from the 8.9 percent management agent fee.
2019-CH-1003 | Septiembre 03, 2019
The Management Agent for Lake View Towers Apartments, Chicago, IL, Did Not Always Comply With HUD’s Section 8 HAP Program Requirements
Housing
- Status2019-CH-1003-001-AOpenClosed$30,037Questioned Costs
Recommendations with questioned costs identify costs: (A) resulting from an alleged violation of a law, regulation, contract, grant, or other document or agreement governing the use of Federal funds; (B) that are not supported by adequate documentation (also known as an unsupported cost); or (C) that appear unnecessary or unreasonable.
Reimburse HUD $30,037 from nonproject funds for the overpayment of housing assistance and utility allowances due to incorrect calculations.
- Status2019-CH-1003-001-BOpenClosed$144Funds Put to Better Use
Recommendations that funds be put to better use estimate funds that could be used more efficiently. For example, recommendations that funds be put to better use could result in reductions in spending, deobligation of funds, or avoidance of unnecessary spending.
Reimburse the appropriate households $144 from nonproject funds for the underpayment of housing assistance due to incorrect calculations.
- Status2019-CH-1003-001-COpenClosed$159,938Questioned Costs
Recommendations with questioned costs identify costs: (A) resulting from an alleged violation of a law, regulation, contract, grant, or other document or agreement governing the use of Federal funds; (B) that are not supported by adequate documentation (also known as an unsupported cost); or (C) that appear unnecessary or unreasonable.
Support or reimburse HUD $159,938 from nonproject funds for the unsupported payments of housing assistance cited in the finding.
- Status2019-CH-1003-001-DOpenClosed$26,915Questioned Costs
Recommendations with questioned costs identify costs: (A) resulting from an alleged violation of a law, regulation, contract, grant, or other document or agreement governing the use of Federal funds; (B) that are not supported by adequate documentation (also known as an unsupported cost); or (C) that appear unnecessary or unreasonable.
Pursue collection from the applicable household or reimburse HUD $26,915 from nonproject funds for the overpayment of housing assistance due to unreported income.
- Status2019-CH-1003-001-EOpenClosed$54,257Funds Put to Better Use
Recommendations that funds be put to better use estimate funds that could be used more efficiently. For example, recommendations that funds be put to better use could result in reductions in spending, deobligation of funds, or avoidance of unnecessary spending.
Implement adequate quality control procedures to ensure that housing assistance payments are appropriately calculated and supported. These procedures and controls should ensure that $54,257 in program funds is appropriately used for future payments.
- Status2019-CH-1003-001-FOpenClosed
Ensure that third-party verifications, such as tax returns provided by the applicant, are from the source by obtaining certified tax returns from the Internal Revenue Service.
- Status2019-CH-1003-001-GOpenClosed
Revise its occupancy standards to include policies and procedures to prevent underutilization of the project’s units.