The U.S. Department of Housing and Urban Development (HUD), Office of Inspector General, audited the State of Kansas' (State) Neighborhood Stabilization Program I (NSP I). Our audit objectives were to determine whether the State properly obligated its NSP I funds and to determine whether the State's contracts contained all of the required provisions. We concluded the State improperly obligated more than $12 million of its NSP I funds…

We reviewed 19 Federal Housing Administration (FHA) loans Americare Investment Group (Americare) underwrote as an FHA direct endorsement lender. Our review objective was to determine whether Americare underwrote the 19 loans in accordance with FHA requirements. This review is part of Operation Watchdog, an Office of Inspector General (OIG) initiative to review the underwriting of 15 direct endorsement lenders at the suggestion of the FHA…

The U.S. Department of Housing and Urban Development’s (HUD) Office of Inspector General audited the Federal Housing Administration’s (FHA) Title II single-family lender renewal process. The objective of the audit was to determine whether FHA ensured that lenders submitted recertification requirements in a timely manner. We found that FHA did not ensure that lenders submitted recertification forms, annual fees, and/or audited financial…

The U.S. Department of Housing and Urban Development’s (HUD) Office of Inspector General audited the State of Illinois’ (State) Neighborhood Stabilization Program (Program). The audit was part of the activities in our fiscal year 2010 annual audit plan. We selected the State based upon citizens’ complaints to our office. Our objectives were to determine whether the State (1) had the capacity to effectively and efficiently administer its Program…

We performed a review of 20 Federal Housing Administration (FHA) loans underwritten by Assurity Financial Services, LLC (Assurity). Our review objective was to determine whether Assurity underwrote the 20 loans in accordance with Federal Housing Administration (FHA) requirements. This review is part of Operation Watchdog, an Office of Inspector General (OIG) initiative to review the underwriting of 15 direct endorsement lenders at the…

We performed a review of 20 Federal Housing Administration (FHA) loans underwritten by Assurity Financial Services, LLC (Assurity). Our review objective was to determine whether Assurity underwrote the 20 loans in accordance with Federal Housing Administration (FHA) requirements. This review is part of Operation Watchdog, an Office of Inspector General (OIG) initiative to review the underwriting of 15 direct endorsement lenders at the suggestion…

The U.S. Department of Housing and Urban Development's Office of Inspector General (OIG) reviewed 15 Federal Housing Administration (FHA) loans that D & R Mortgage Corporation (D & R) underwrote as an FHA direct endorsement lender. Our review objective was to determine whether D & R underwrote the 15 loans in accordance with FHA requirements. This review is part of Operation Watchdog, an OIG initiative to review the underwriting…

We audited New England Regional Mortgage Corporation (Corporation), a Federal Housing Administration (FHA) lender approved to underwrite and close mortgage loans without prior FHA review or approval. We selected the Corporation because its early payment default rate for insured single-family loans originated between January 1, 2008, and December 31, 2009, was significantly higher than the default rate in the local area in which it does business…

In response to a request from Congresswoman Mary Jo Kilroy, the U.S. Department of Housing and Urban Development's Office of Inspector General conducted a review of the allegations that Columbus Properties Limited Partnership (Columbus Properties) did not renovate six apartment complexes in Ohio for which it obtained HUD-insured mortgages. Congresswoman Kilroy asked for a review based on local newspaper articles that alleged waste and abuse…

We conducted the audit of the Retreat at Santa Rita Springs (community), a Federal Housing Administration-insured multifamily property under the Section 231 of the National Housing Act, in response to a congressional request from Representative Gabrielle Giffords of the 8th Congressional District of Arizona. In November 2009, the owners of the community defaulted on its $29.9 million U.S. Department of Housing and Urban Development (HUD)-…

We completed a review of the Retreat at Santa Rita Springs (community), a Federal Housing Administration (FHA)-insured multifamily project under Section 231 of the National Housing Act. Our audit was in response to a request for audit from Representative Gabrielle Giffords of the 8th District of Arizona. The owner defaulted on the $29.9 million U.S. Department of Housing and Urban Development (HUD)-insured mortgage in November 2009, the month…

We reviewed 20 Federal Housing Administration (FHA) loans that Dell Franklin Financial, LLC (Dell), underwrote as an FHA direct endorsement lender. Our review objective was to determine whether Dell underwrote the 20 loans in accordance with FHA requirements. This review is part of Operation Watchdog, an Office of Inspector General (OIG) initiative to review the underwriting of 15 direct endorsement lenders at the suggestion of the FHA…

We reviewed 20 Federal Housing Administration (FHA) loans that Alacrity Lending Company (Alacrity) underwrote as an FHA direct endorsement lender. Our review objective was to determine whether Alacrity underwrote the 20 loans in accordance with FHA requirements. This review is part of Operation Watchdog, an Office of Inspector General (OIG) initiative to review the underwriting of 15 direct endorsement lenders at the suggestion of the FHA…

The U.S. Department of Housing and Urban Development's (HUD) Office of Inspector General (OIG) reviewed 20 Federal Housing Administration (FHA) loans that Mac-Clair Mortgage Corporation (Mac-Clair) underwrote as an FHA direct endorsement lender. Our review objective was to determine whether Mac-Clair underwrote the 20 loans in accordance with FHA requirements. This review is part of “Operation Watchdog”, an OIG initiative to review the…

The U.S. Department of Housing and Urban Development’s (HUD) Office of Inspector General audited National Home Management Solutions (National Home), HUD’s management and marketing contractor for HUD real estate-owned properties in Ohio. We selected National Home based on a citizen’s complaint received by our office. Our objective was to determine whether National Home complied with HUD’s requirements regarding the sale of HUD single-family real…

The U.S. Department of Housing and Urban Development's (HUD) Office of Inspector General (OIG) reviewed 20 Federal Housing Administration (FHA) loans that Birmingham Bancorp Mortgage Corporation (Birmingham) underwrote as an FHA direct endorsement lender. Our review objective was to determine whether Birmingham underwrote the 20 loans in accordance with FHA requirements. This review is part of “Operation Watchdog,” an OIG initiative to…

The U.S. Department of Housing and Urban Development’s (HUD) Office of Inspector General audited Access National Mortgage Corporation (Access National) to determine whether it complied with HUD regulations, procedures, and instructions in originating, underwriting, and submitting for endorsement the FHA-insured loans selected for review. Access National generally complied with HUD regulations, procedures, and instructions in the origination and…

We completed an audit of the City of Jersey City’s (City) Community Development Block Grant (CDBG) float loan activity. Our audit objective was to determine whether the City ensured that CDBG funds used for the float loan complied with applicable rules and regulations. The City did not comply with applicable regulations and failed to take timely action when the float loan defaulted. Specifically, it did not (1) make a good faith effort to…

We evaluated the U.S. Department of Housing and Urban Development’s (HUD) award process for the Neighborhood Stabilization Program 2 (NSP2). We initiated the review as part of the activities in our fiscal year 2010 annual audit plan. Our primary objective was to determine whether HUD’s methodology and controls for the evaluation and selection of applications for the $1.93 billion in NSP2 funds were in accordance with applicable requirements. We…

We audited the Fairfax, VA, branch office (branch office) of Prospect Mortgage, LLC (Prospect Mortgage), because it had one of the highest default rates for U.S. Department of Housing and Urban Development (HUD)-approved lenders for loans issued in the State of Maryland. Our objective was to determine whether Prospect Mortgage and its branch office complied with HUD regulations, procedures, and instructions in the origination and quality…