Finding Text
2025 -001 Delinquent Debt Payments Noncompliance Information: Underpayment of the Flex Subsidy Loan. Condition: The Organization has a HUD insured loan to which it is not making payments. The loan is in default and can be called at any moment. The balance of the loan is $1,138,002 and $61,471 was accrued as interest for the current year. In total, the Organization owes $1,199,473 on its loan to HUD. Criteria: The Organization is required to make monthly payments on its loan from HUD. Effect: The Property is out of compliance with HUD rules and regulations for the Flex Sub Loan. Recommendations: We recommend that the Project negotiate with HUD to decrease the monthly payments and bring the loan current and implement procedures to ensure that future amounts due on the contingent mortgage are paid in a timely manner. Auditee Response: On June 1, 2020, the Organization reached out to HUD with a plan to resolve the delinquent payments. Suggestions were to either forgive the loan or to have the payments be made from surplus cash. The Organization has not received correspondence concerning these suggestions as of the date on this report.