| ID | Status | Date | Public/Private | Industry | AHACPA Contact |
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| #7694 | Closed | public | Multifamily | Les Sparks |
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I have a question regarding the two latest surplus cash calculations. When they say we should be including the principal, interest and reserves from the next month’s mortgage payment as liabilities there are some questions as to do we include additional interest for the next 30 days. So for example if we have a mortgage payment due 1/1 and we have accrued interest already accrued for the month of December do you include another 30 days of interest for January? To me it seems like you would as it is due in the next 30 days but technically it isn’t paid until 2/1. |
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From Les Sparks: The quick answer is no. All projects were already accruing the interest on the mortgage. All HUD did was to require the addition of the remaining portions of the January payment. Of course, that requirement is only for project that received the 2014 Regulatory Agreement. The 2011 Agreement required the mortgage and R4R payment only with the previously recorded interest. Prior agreements only include interest. From client: Les, one follow up question to this. In the regulatory agreement, specifically the 2011 version it states…”all accounts and accrued items payable within thirty days after the end of the fiscal period” Would the interest need to be included due to this statement? I just want to make sure I am covering all basis here. Thanks From Les: In every Agreement interest is always included for the next month. That is the only consistency between all of the agreements. 2011 ADDED Principal and R4R. Then 2014 added the remaining taxes, insurance and MIP amounts. Nothing was ever taken out, just added. So interest always remains, unless it is payable form surplus cash (M2M 2nd and 3rd mortgages) |