FDIC
 

MULTIFAMILY AFFORDABLE HOUSING
 

COMPLIANCE REPORT (continued)
 

APPENDIX J 

MONITORING MULTIFAMILY BULK PURCHASES 

WITH MASTER LURAs 

OVERVIEW 

In the large majority of AHDP multifamily 

purchases, owners sign an individual LURA for each 

property that sets forth property-specific lower income 

occupancy requirements. A few owners making bulk 

purchases signed a Master LURA that gives them 

flexibility in how the lower-income occupancy 

requirements for the purchase are met. Although each 

property in the purchase has an individual LURA, the 

Master LURA that covers all properties allows the owner 

to vary the number of Qualifying Units in an individual 

property as long as the total number of QUs throughout 

the purchase meets the set-asides established in the 

Master LURA. 

If an agency has been informed by FDIC that it will 

need to monitor a multifamily bulk purchase with a Master 

LURA, agency staff should follow the special instructions 

in this appendix as well as the procedures in Chapters 3 

and 4 when monitoring this type of purchase. 

MONITORING OWNER COMPLIANCE 

The principal consideration in monitoring 

properties with Master LURAs is that the occupancy 

requirements apply to the whole purchase rather than a 

single property. All other program requirements apply in 

the same way they would to a multifamily property with an 

individual LURA. 

Pre-Compliance Monitoring 

During the pre-compliance period, the owner must 

follow the same procedures for leasing available units to 

reach the lower income set-asides (see Exhibit 2-4). For 

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MULTIFAMILY AFFORDABLE HOUSING
 

COMPLIANCE REPORT (continued)
 

example, when holding units available for Qualified 

Tenants, the number held available must equal the 

number of additional QUs needed to meet the Total SetAside for the purchase. If the total number of vacant units 

is less than the number of QUs needed then the vacant 

units in every property must be held available for Qualified 

Tenants. 

This requirement would apply to a property in the 

purchase even if the percent of LI or VLI units in that 

property exceeded the set-aside percentage listed in the 

Master LURA. For example, assume a purchase has not 

met its Total Set-Aside of 35 percent. Even if half of the 

units in a given property within the purchase are QUs, as 

long as the purchase lacks enough vacancies to meet the 

additional number of QUs needed, vacant units in the 

property may only be rented to Qualified Tenants. 

Ongoing Monitoring 

Once a purchase reaches full compliance, the 

owner must follow the procedures listed in Section 2.5-B 

for maintaining the required number of QUs. However, 

when the owner is required to rent the next available unit 

or the next available QU to a Qualified Tenant, the 

requirement applies throughout the purchase. For 

example, if the tenant of a QU was found to be overincome, the next unit of comparable or smaller size that 

became available in the purchase would need to be 

rented to a Qualified Tenant. 

The conditions on shifting the QU designation from 

one unit to another also apply to these purchases. The 

owner may not remove the QU designation from a unit 

unless the tenant is over-income or moves out of the 

property. 

Reviewing Compliance Reports 

When the owner submits a compliance report, the 

report will cover units throughout the entire purchase. In 

reviewing these reports, monitoring staff should follow the 

same procedures used for reports from an individual 

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MULTIFAMILY AFFORDABLE HOUSING
 

COMPLIANCE REPORT (continued)
 

property treating the purchase as though it represented 

one large property. 

When checking the eligibility of tenants in QUs or 

compliance with the rents for these units, the applicable 

income and rent limits may vary across properties. 

Monitoring staff must make sure they compare the figures 

in the report to the appropriate limits. Agencies may 

amend the Compliance Report format if desired. 

Just as if monitoring an individual property, if 

agency staff discover a compliance violation, the agency 

should issue a Notice of Non-Compliance and follow the 

procedures in Chapter 4 to compel the owner to restore 

compliance. 

On-Site Visits 

Owners who made bulk purchases under a Master 

LURA are required to keep a listing of all units in the 

purchase at a central management office. When the 

agency is preparing to conduct an on-site visit, monitoring 

staff should contact this central office and obtain 

occupancy lists for the purchase broken down by property 

for the past three months. These lists should indicate the 

QUs in the purchase for each month. 

Monitoring staff should first review each list and 

confirm that the purchase contained a sufficient number of 

QUs (LI and VLI) to meet the set-asides in the Master 

LURA. 

Then, using the most recent list, monitoring staff 

should select a sample of units to visit from several 

properties. When choosing properties and units to visit, 

monitoring staff should identify a group of units that will 

allow them to not only review tenant files for several types 

of units, but also to perform spot checks that the QU 

designation has not been improperly removed from the 

tenant of a QU. For example, if the earliest unit listing 

shows that Unit 225A in Property X is a QU rented to 

tenant "A. Michaels" and the next month's listing shows 

the same unit rented to tenant "Michaels" as an 

unrestricted unit, monitoring staff may want to visit that 

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property and check the tenant files to confirm that A. 

Michaels did not have the QU designation improperly 

removed. 

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Agencies should follow the guidelines in Chapter 3 

regarding the frequency of on-site visits and the type of 

follow-up needed, if any. As mentioned above, if the 

owner is found to be out of compliance, monitoring staff 

should issue a Notice of Non-Compliance following the 

procedures set forth in Chapter 4. 

ENFORCING OWNER COMPLIANCE 

When an agency uncovers an occupancy violation, 

the whole purchase may be affected by the required 

corrective actions and special steps may need to be 

taken. If the owner commits another type of violation, 

such as a rent limit violation, the enforcement measures 

will be much the same as those for the owner of a single 

property who commits the same violation. 

MONITORING FEES 

The monitoring fees for bulk purchases with a 

Master LURA are determined using the same method 

applied to individual properties. 

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MULTIFAMILY AFFORDABLE HOUSING 

COMPLIANCE REPORT (continued) 

FDIC
 

AFFORDABLE HOUSING PROGRAM
 

HOMEBUYER INCOME CERTIFICATION
 

PART I: SUMMARY OF HOUSEHOLD INCOME DATA 

1. Name (Last, First) 

A. 

2. Household Size 3. Household 

Income 

B. 

C. VLI _____ 

D. LI _____ 

A. Assets: 

Household 

Member Asset Description Total Cash Value 

Income from Assets 

4. Total Net Value of Assets 4. $...................... 

5. Total Actual Asset Income 5. $.................... 

6. If line 4 is greater than $5,000, multiply line 4 by passbook savings rate and enter 

result here; otherwise, leave blank. 

Passbook savings rate = _________________% 6. $.................... 

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MULTIFAMILY AFFORDABLE HOUSING 

COMPLIANCE REPORT (continued) 

B. Anticipated Annual Income: 

Household 

Member 

a. Wages/ 

Salaries 

b. Benefits/ 

Pensions 

c. Public 

Assistance 

d. Other Income e. Asset Income 

A. 

Enter the greater of 

lines 5 or 6 in box e. 

B. 

C. 

D. 

7. Totals a. b. c. d. e. 

8. Enter total of items 7a. through 7e. 

This is Annual Income 8. $................... 

J-7 September 28, 2000 
_________________________________________________ __________________ 

__________________________________________________ __________________ 

__________________________________________________ __________________ 

FDIC 

MULTIFAMILY AFFORDABLE HOUSING 

COMPLIANCE REPORT (continued) 

PART II: HOMEBUYER CERTIFICATION 

I/We certify that the information in this form is true and complete to the best of my/our knowledge and belief. 

I/We consent to the disclosure of such information to the FDIC and/or agency designated to monitor program 

compliance. I/We understand that this certification is a part of the application process and does not guarantee 

the transfer of ownership. 

(SIGNATURE - HEAD OF HOUSEHOLD) DATE 

(SIGNATURE - SPOUSE/CO-HEAD OF HOUSEHOLD) DATE 

PART III OWNER/AGENT CERTIFICATION 

Based on the income information provided by the household and verified by me or my authorized agent, I certify 

that the household identified above is a: 

_ Very Low-Income (VLI) Household based on the current applicable definitions published by the U.S. 

Department of Housing and Urban Development. 

_ Lower Income (LI) Household based on the current applicable definitions of a low-income household 

published by the U.S. Department of Housing and Urban Development. 

(OWNER/AUTHORIZED AGENT) DATE 

PART IV: TO BE COMPLETED BY MANAGEMENT STAFF 

Property: Prepared by: 

Property ID#: Applicable LI Limit: 

Unit # or Address: Applicable VLI Limit: 

WARNING: Section 1001 of Title 18 of the U.S. Code makes it a criminal offense to make willful false 

statements or misrepresentations to any Department or Agency of the United States as to any matter within its 

jurisdiction. 

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