232

New Construction or Substantial Rehabilitation
Nursing Homes/Assisted Living Facilities
HUD Section 232
Click here to view PDF Printable Term Sheet

Borrower:

Profit and Non-profit

Maximum Loan:

New Construction:
The lesser of: (a) 90% of FHA's value (95% for private non-profits) or (b) amount of debt serviced by 90% of the estimated NOI attributed to realty (95% for non profits)
Substantial Rehabilitation:
Purchase: The lesser of: (a) 90% of FHA's value (95% for private non-profits); (b) amount of debt serviced by 90% of the estimated NOI attributed to realty (95% for non profits)
Refinance: 100% of costs plus the lesser of: (a) 90% of existing value (95% for non-profits); or (b) existing debt

Interest Rate:

Fixed rate determined by market rates at time of rate lock

Prepayment Provisions:

The remaining term of existing mortgage

Term:

40 years

Amortization:

Fully amortizing loan

Recourse:

No personal or corporate liability

Rate Lock:

30 to 45 days prior to closing

Subordinate Debt:

None for new construction or substantial rehabilitation. Additions and alternations are funded with Subordinate Debt insured under section 241 of the National Housing Act.

Assumability:

Subject to HUD and BHMC approval.

Escrows:

Monthly escrows are required for taxes, insurance, mortgage insurance premium and replacement reserves.

FEES (included in mortgage):

HUD Application Fee:

0.3% of mortgage amount

Third Party Reports:

Market Study, Appraisal, Architectural/Engineering Report, Cost Analysis, Environmental Assessment.

Inspection Fee:

0.5% of mortgage amount

Financing Fee:

Negotiable

Closing Costs:

Standard: legal, title, survey

Mortgage Insurance Premium:

1% of the actual outstanding daily balance during construction, thereafter,.5% annually based on the declining mortgage balance.

Estimated Processing Time:

Generally 90 days to the issuance of the Firm Commitment; three to four weeks to close the loan.

Territory:

Nationwide