Rental Housing: Implementing the New Federal Incentives to Deter Prepayments of HUD Mortgages
PEMD-91-2
Published: Apr 30, 1991. Publicly Released: May 30, 1991.
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Highlights
Pursuant to a congressional request, GAO provided information about the likelihood that owners of low- and moderate-income rental housing stock will seek prepayments of mortgages insured under the National Housing Act.
Recommendations
Recommendations for Executive Action
| Agency Affected | Recommendation | Status |
|---|---|---|
| Department of Housing and Urban Development | The Secretary of Housing and Urban Development should ensure that its regional and field office market economists participate in delimiting the relevant local markets, as defined in section 215(a)(2) of the Low-Income Housing Preservation and Resident Homeownership Act of 1990, for the federal cost limits test and in determining whether there is an inadequate supply of decent, affordable housing for the windfall profits test. |
Closed – Implemented
HUD has agreed to use its market economists, as GAO recommended.
|
| Department of Housing and Urban Development | The Secretary of Housing and Urban Development should enhance HUD staff expertise in real estate finance through hiring, training, and contracting in order to ensure better and more timely negotiation of incentives. |
Closed – Implemented
HUD held training sessions in August and September 1991 and more are scheduled.
|
| Department of Housing and Urban Development | The Secretary of Housing and Urban Development should review current guidance being provided on negotiating incentive packages in light of the 1990 legislation, providing better guidance where necessary. |
Closed – Implemented
HUD issued a field handbook for title II on April 9, 1991, and one for title VI will be issued in March 1992.
|
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Topics
Advance paymentsExcess profitsFederal aid for housingGovernment guaranteed loansLoan interest ratesLoan repaymentsLow income housingMortgage programsRent subsidiesRental housing