SENIORS HOUSING 232-241(A) FHA-INSURED FINANCING
Non-recourse, supplemental financing for repairs, additions, and improvements of properties with existing FHA-insured loan.
Eligible Properties
Loan Features
Mortgage Loan Amount
Project must be insured under section 232 mortgage
• Low, fixed interest rates
• Non-recourse and fully assumable
• Eligible transaction costs, including certain owner elective repairs, are mortgageable
• Terms of first mortgage remain unchanged
Lesser of:
• 90% of eligible costs
• 90% of as proposed value less 90% of as is value (determined by lender ordered appraisal)
• 90% of stabilized value less all outstanding debt
• Minimum underwritten DSCR of 1.45x when combining first and supplemental mortgage debt service
Maximum Term
Prepayment
Escrow
Transaction Costs
Coterminous with existing mortgage unless otherwise approved by HUD
Standard prepayment schedule is 10% in year one, stepping down 1% annually, however, alternative prepayment structures are available subject to market conditions
• Working capital escrow of 4% of loan amount, unused portion will be returned to borrower
• Initial operating deficit calculated by HUD and accessible upon issuance of certificate of occupancy
• Minor movable equipment
• Monthly escrows for real estate taxes, property insurance, and replacement reserves are required
• Purchase price of land, buildings or existing debt
• Certified construction costs, bond premium, builder’s profit allowance, and other fees
• Architectural fees for design and supervision
• Appraisal, engineering, and environmental inspection reports
• MIP during construction
• Interest, insurance, and real estate taxes during construction
• Legal, organizational, audit, title & recording, and survey fees
• HUD application fee of 0.30% & HUD inspection fee of 0.50%
• FF&E – major fixed and movable items