Mortgage Loan Enforcement and Administration Corporation
Administration of Debt Service for Mitchell-Lama Projects During the late 1960s and early 1970s, more than 100 housing projects for low-income and middle-income families were financed by State loans and developed by private housing companies in accordance with provisions of the Mitchell-Lama Law. These loans and projects are overseen by the Mortgage Loan Enforcement and Administration Corporation. We examined the Corporation's administration of the loans and found that, because many of the projects do not generate enough revenue to cover their operating expenses and loan repayments, additional loans have been made; as a result, the total amount of debt related to the projects is increasing. We examined some of the additional loans and found that the need for the funds often was not documented. We also found that projects were not always inspected before they were loaned additional funds. We further found that many projects had not been inspected for more than a year, and action was not always taken to ensure that hazardous conditions identified during inspections were corrected as reported. We also found that the financial status of the projects was not always effectively analyzed to determine whether payments could be made on overdue loans.
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