| Property Types: |
Market Rate, Affordable and Subsidized Multifamily |
| Eligible Borrowers: |
For profit and non-profit entities |
| Loan Amount: |
No Minimum/Maximum-Statutory Mortgage Limits (adjusted for locality) |
| Region: |
Nationwide |
| Term & Amortization: |
New Construction:
- Construction term, plus
- 40 year self-amortizing loan
Rehabilitation:
- Rehabilitation term, plus
- 40 year self-amortizing permanent loan or 75% of estimated remaining economic useful life of the project, plus the construction term
|
| General Loan Terms: |
New Construction:The loan amount is the lesser of
- 83.3% (87% for affordable) of HUD’s estimate of replacement cost (Rehabilitation- plus “As-Is” value of property)
- 1.20x DSCR, 1.15x DSCR (for affordable)
|
| Interest Rate: |
Fixed rate subject to market conditions at the time of rate lock |
| Recourse: |
None except standard carve outs |
| Assumable: |
Yes, subject to HUD approval. |
| Prepayment: |
Negotiable. Typically loans are prohibited from prepayment for the first 2 years then an 8% penalty declining 1% each year thereafter until 0%. |
| Mortgage Insurance Premium: |
0.45% during construction and 0.45% annually |
| Other: |
- Davis Bacon prevailing wages are required
- Builders and Sponsors Profit and Risk Allowance of 10% of all construction costs can be used for sponsors with identity of interest general contractor
- Secondary financing is allowed subject to HUD approval, however, Loan to Value must not exceed 92.5% and the form of secondary financing must be in that of a surplus cash note
- Escrows required for repairs, mortgage insurance premium, taxes, insurance and replacement reserves
- Third parties include a market study, appraisal, plans and specs review and Phase I
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