Licensed Nursing Homes, Assisted Living, Intermediate Care, and Board and Care
a) Must provide continuous protective oversight;
b) Must offer three meals per day;
c) Facility must be licensed by the state;
d) Non-resident day care not to exceed 20% of gross area and 20% of gross income;
e) May include up to 25% non-licensed independent living units; and
Limited to 10% of gross floor area and 15% of gross income
New construction or Substantial rehabilitation which is defined as:
a) 15% of post-rehabilitated appraised value, or replacement of two or more major building components
b) Additions are not included in the eligibility test
Payment of prevailing wages is required by HUD; wages are determined by the Department of Labor.
Single asset, special purpose entity, either for profit or non-profit
No maximum (Limited by loan parameters)
Non-recourse
Fixed for term of loan, determined by market conditions at time of rate lock (Rate lock deposit is 1% and refunded at closing)
New Construction: Maximum loan amount will be the lesser of:
a) Recommended % of LTV;
b) Recommended % of Replacement Cost; or
c) Recommended Debt Service Coverage Ratio
Maximum loan will be the lesser of:
a) Recommended % of Loan to Value;
b) Recommended % of Rehabilitation Cost plus the lesser of: existing indebtedness or recommended % of as-is value for properties owned; or
c) Recommended % of Rehabilitation Costs plus the lesser of: recommended % of purchase price or recommended % of as-is value for properties to be purchased; or
d) Recommended Debt Service Ratio
Actual construction period plus 40 years (fully amortizing with interest only payable during construction period)
Negotiable with best pricing for 10 years of call protection (can be combination of lockout and/or penalty); Loan is fully assumable subject to HUD approval
f) Minor movables; and
g) Offsite escrows (if applicable)
Payable at Closing an amount equal to 0.57% of the loan amount for each year of construction
a) HUD application fee of 30 basis points due with submission of firm application;
b) Mortgage Insurance Premium is 57 basis points of principal mortgage amount a year after final endorsement;
c) HUD Inspection Fee is 0.5% of the mortgage amount for new construction and 0.5% of total improvements for substantial rehabilitation;
d) FHA Mortgage Insurance Premium due at closing; and
e) Actual Cost of Third Party Reports
Appraisal, Market Study, Phase I and Plans and Specs Review are required
8-12 months depending on whether Borrower wants to submit a pre-application
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