FHA 221(d) provides mortgage insurance for new construction or substantial rehabilitation of rental or cooperative multifamily housing.
- Multifamily project is to be built or undergoing substantial rehabilitation. Detached structures and row houses are eligible.
- Multifamily rental properties and cooperatives.
- All units must contain full kitchens or kitchenettes and bathrooms.
- Properties must meet all building and other local code requirement including properties requiring Credit Enhancement for bond, LIHTCs and affordable housing transactions.
The loan can not exceed the lesser of:
- 90% of projected net operating income divided by the applicable loan constant
- 90% of estimated eligible replacement cost of the projects, including land at market value and a 10% builder/developer credit for profit; or
- Statutory mortgage limits designated by HUD
The Loan can not exceed the lesser of:
- 90% of the projects projected net operating income divided by the applicable loan constant.
- 90% of the estimated eligible rehabilitation costs, including a 10% builder developer credit, plus 90% of the projects fair market value prior to rehabilitation; or
- Statutory mortgage limits as prescribed by HUD.
- Non-profit mortgagors are eligible for up to 100% of cost and a debt service loan of up to 95% of projected NOI.
Maximum loan term is 40 years plus construction period Up to 40 year amortization
Fixed Rate-construction and permanent
Maximum 95% occupancy
Non-recourse-Construction and Permanent
Assumable subject to lender and HUD approval and assumption fee
Repairs must exceed $6500 per unit (adjusted for local high cost factor),15% of the"as rehabbed"appraised value or replacement of 2 or more major building systems
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