Finding Text
Criteria - The Housing Company’s regulatory agreement with HUD requires the Housing Company to maintain a Residual Receipts Reserve. Condition - During the audit, we determined that the residual receipts reserve was not funded during the refinance of the mortgage. Effects - The Housing Company is not in compliance with the Regulatory Agreement. Cause - During the mortgage refinancing, the new mortgage company failed to create and properly fund the residual receipts reserve. Recommendation - The Housing Company should create and fund the Residual Receipts Reserve account immediately. Views of Responsible Official The Housing Company agrees with the finding and will adhere to the corrective action plan.