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
Project must be insured under section 232 mortgage
Loan Features
• 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
Mortgage Loan Amount
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
Coterminous with existing mortgage unless otherwise approved by HUD
Prepayment
Standard prepayment schedule is 10% in year one, stepping down 1% annually, however, alternative prepayment structures are available subject to market conditions
Escrow
• 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
Transaction Costs
• 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
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