We reviewed the County of Santa Barbara’s HOME Investment Partnerships program due to concerns expressed by the U.S. Department of Housing and Urban Development’s (HUD) Los Angeles Office of Community Planning and Development regarding the County’s administration of its HOME program.  Our objective was to determine whether the County performed its monitoring responsibilities and ensured that incurred HOME program expenditures were eligible...

We audited the Federal Housing Administration (FHA)-insured loan process at All Western Mortgage’s Las Vegas, NV, home office as part of our efforts to improve the integrity of the single-family insurance programs. We selected All Western Mortgage because it is one of the top 10 originators in Nevada and the U.S. Department of Housing and Urban Development’s (HUD) Quality Assurance Division had not performed a review since 2005. The...

We audited certain portions of the U.S. Department of Housing and Urban Development’s (HUD) multifamily housing and healthcare insured mortgage programs as part of our fiscal year 2012 annual audit plan.  The objective of the review was to determine the adequacy of the Office of Housing’s procedures and controls for selecting, conducting, and following up on postendorsement underwriting reviews of insured multifamily and healthcare loans...

We audited the U.S. Department of Housing and Urban Development’s (HUD) servicing of multifamily projects with HUD-held mortgages because it was part of the Office of Inspector General’s (OIG) annual audit plan. We reviewed 33 multifamily projects with HUD-held mortgages that totaled $307.9 million. Our objective was to determine whether HUD (1) obtained, documented, and reviewed the monthly accounting reports and (2) collected monthly net...

The U.S. Department of Housing and Urban Development (HUD), Office of Inspector General audited Volunteers of America’s (VOA) Whispering Pines Senior Village’s Green Retrofit program funded by the American Recovery and Reinvestment Act. Our objective was to determine whether VOA used its Whispering Pines Green Retrofit Recovery Act funds in accordance with U.S. Department of Housing and Urban Development (HUD) and Recovery Act rules and...

We audited the procurement process of Madison Park North Apartments, a Section 236 property, at the request of the Director of the U.S. Department of Housing and Urban Development’s (HUD) Baltimore Office of Multifamily Housing Programs. We also reviewed Madison’s Park’s use of its reserve for replacement account. Madison Park generally ensured that procurement and reserve for replacement account requirements were met. However, it did not...

We conducted a limited review of Federal Housing Administration (FHA) loans underwritten by Pulte Mortgage LLC. We selected the lender based on the results of an auditability survey, which determined that Pulte Mortgage allowed prohibited restrictive covenants to be filed against Federal Housing Administration (FHA)-insured properties. The objective of our review was to determine the extent to which Pulte Mortgage failed to prevent the...

We conducted a limited review of Federal Housing Administration (FHA) loans underwritten by CTX Mortgage Company LLC. We selected the lender based on the results of an auditability survey, which determined that CTX Mortgage allowed prohibited restrictive covenants to be filed against Federal Housing Administration (FHA)-insured properties. The objective of our review was to determine the extent to which CTX Mortgage failed to prevent the...

The civil division of the Western District of Oklahoma U.S. Attorney’s Office settled alleged violations of equity skimming against the owners of Heartland Health Care Center of Bethany. The equity skimming allegations stemmed from our December 2004 audit report outlining the misuse of funds. As a result of the combined efforts of the U.S. Attorney’s office; the U.S. Department of Housing and Urban Development (HUD), Office of Inspector...

We audited Eustis Mortgage Corporation, a Federal Housing Administration (FHA) direct endorsement lender located in New Orleans, LA. We selected Eustis Mortgage as a result of our regional risk analysis and the U.S. Department of Housing and Urban Development’s (HUD), Office of Inspector General’s (OIG) annual audit plan goal to review single-family programs and lenders. Our objective was to determine whether Eustis Mortgage (1) complied with...

We audited Bay Vista Methodist Heights, San Diego, CA, to determine the full extent of the misuse of its trust funds. We selected Bay Vista for review based on a referral from the Office of Multifamily Housing, stating that Bay Vista violated its trust fund agreement with the U.S. Department of Housing and Urban Development (HUD) because the former chief financial officer transferred more than $3 million in restricted funds into Bay Vista’s...

We reviewed 32 Federal Housing Administration (FHA) loans that New Day Financial, LLC, underwrote as a U.S. Department of Housing and Urban Development (HUD) FHA direct endorsement lender. We conducted the review as a result of a risk model assessment that identified mortgage lenders that were at high risk to cause losses to the FHA insurance fund. New Day was one of the lenders identified that made insurance claims within the first 2 years of...

We audited Ofori & Associates, PC, regarding its U.S. Department of Housing and Urban Development (HUD) real estate-owned (REO) Management and Marketing (M&M) III program. This review was part of the Office of Inspector General’s efforts to improve the integrity of the single-family insurance program. Our audit objective was to determine whether Ofori complied with case processing requirements and timeframes to obtain the highest net...

We conducted a limited review of Federal Housing Administration (FHA) loans underwritten by Standard Pacific Mortgage, Inc. We selected the lender based on the results of an auditability survey, which determined that Standard Pacific Mortgage allowed prohibited restrictive covenants to be filed against FHA-insured properties. The objective of our review was to determine the extent to which Standard Pacific Mortgage failed to prevent the...

We audited the U.S. Department of Housing and Urban Development’s (HUD) oversight of the Assisted Living Conversion Program. We initiated the audit as part of the activities in our fiscal year 2012 annual audit plan, which included contributing to the improvement of HUD’s execution of and accountability for fiscal responsibilities. Our audit objective was to determine whether HUD had adequate oversight of its Assisted Living Conversion Program...

We audited the U.S. Department of Housing and Urban Development’s (HUD) oversight of its Home Equity Conversion Mortgage Program based on our annual audit plan and our strategic goal to improve the integrity of HUD’s single-family insurance programs. This is the second of two reports that we issued on HUD’s oversight of the Program. Our objective was to determine whether HUD controls prevented borrowers from renting their properties to Section...

We audited HUD's Region 3 Offices of Multifamily Housing to determine whether HUD ensured that rents and excess income for Section 236 properties were properly identified and remitted to HUD. We performed this audit based on our audit plan and problems identified during an external audit of a Section 236 property located in Washington, DC. HUD's Region 3 Offices of Multifamily Housing generally ensured that Section 236 properties...

We audited Prysma Lending Group, LLC, a nonsupervised lender, located in Danbury, CT, in support of the U.S. Department of Housing and Urban Development (HUD), Office of Inspector General’s (OIG) goal of improving the integrity of the single-family insurance program. We selected Prysma for audit because its 3.28 percent default rate for Federal Housing Administration (FHA)-insured single-family loans with beginning amortization dates between...

In conjunction with our external audit of Innotion Enterprises, Inc. (Audit Report #2012-LA-1010), we reviewed termite inspection passthrough costs that it submitted to the U.S. Department of Housing and Urban Development (HUD) for payment as part of its real estate-owned (REO) Management and Marketing III (M&M III) program field service manager contract. We selected Innotion’s Las Vegas, NV, branch based on the size and scope of its...

The U.S. Department of Housing and Urban Development, Office of Inspector General audited Allen Mortgage, Limited Liability Company, a Federal Housing Administration (FHA) nonsupervised lender. We selected Allen Mortgage for audit based on its high default and claim rate for the FHA-insured loans sponsored in Region 5. Our objectives were to determine whether (1) Allen Mortgage complied with HUD’s regulations, procedures, and instructions in...