Finding Text
The regulatory agreement specifies that the mortgagor shall establish and maintain a reserve for replacements with the mortgage, funded by monthly deposits. During the year ended June 30, 2026, the Project did not fund the reserve for replacements account in accordance with the Regulatory Agreement. The required monthly deposits of $5,000 were not made each month. The Project deposited a total of $30,000 during 2026, resulting in an underfunding of $30,000.The Project did not fully fund the reserve for replacements account in accordance with the Regulatory Agreement. The Project was underfunded by $30,000 as of June 30, 2026. Although the Project maintained a replacement reserve balance of $298,195 and no significant replacement or repair activities were pending during the period, the Project was not in compliance with the required reserve funding provisions of the HUD Regulatory Agreement.