SENIORS HOUSING 232-223(F) FHA-INSURED FINANCING
Non-Recourse, fully assumable financing for purchases and refinances of skilled nursing, assisted living, and memory care communities.
Eligible Properties
Loan Features
• Project must be licensed (or certified in some jurisdictions) and comply with all HUD, federal, state, and local standards. Independent living is eligible up to 25% of total project beds
• Project must have been completed or substantially rehabilitated for at least three years and include a minimum of 20 beds
• Single asset /special purpose borrowing entity required
• Low, fixed interest rates
• Up to 35-year term, fully amortizing
• Non-recourse and fully assumable
• Eligible transaction costs, including certain owner elective repairs, are mortgageable
Mortgage Loan Amount The mortgage is limited to the lesser of:
• 80% of appraised value (85% for non-profits)
• 100% of eligible transaction costs (refinance) or 85% of eligible transaction costs (acquisitions)
• 1.45x underwritten debt service coverage ratio
Prepayment Standard prepayment schedule is 10% in year one, stepping down 1% annually, however, alternative prepayment structures are available subject to market conditions
Escrow Monthly escrows for real estate taxes, property insurance, and replacement reserves
Transaction Costs
• Existing debt or purchase price
• Repairs not exceeding 15% of appraised value after completion
• Third-party reports (appraisal, engineering, phase I, and radon)
• First year MIP
• Financing and placement fees
• Borrower and lender legal fees
• Title, recording, and survey costs
• HUD application fee of 0.30%
• HUD inspection fee (greater of $30/bed or 1% of repair estimate)