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Mortgage Insurance Rental and Cooperative Housing for Moderate Income Families and Elderly, Market Interest Rate
Single Room Occupancy (SRO) may also be insured under this section (see program 14.184).
The Department of Housing and Urban Development's mission is to increase homeownership, support community development and increase access to affordable housing free from discrimination. HUD fulfills this mission through high ethical standards, management and accountability, and by forming partnerships with community organizations.
Persons are encouraged to contact the Multifamily Hub or Program Center with jurisdiction for the proposed project.
HUD Multifamily Hubs or Program Centers are listed at http://www.hud.gov/offices/hsg/mfh/mfbroch/hubs_pcs.cfm or in the Catalog Address Appendix IV.
Program Accomplishments
Not Applicable.
Uses and Use Restrictions
Section 221(d)(4) insures lenders against loss on mortgage defaults for market rate rental projects.
Insured mortgages may be used to finance construction or rehabilitation of detached, semidetached, row, walkup, or elevator-type rental or cooperative housing containing 5 or more units.
The program has statutory mortgage limits which vary according to the size of the unit, the type of structure, and the location of the project.
There are also loan-to- replacement cost and debt service limitations.
Contractors for new construction and substantial rehabilitation projects must comply with prevailing wage requirements under the Davis-Bacon Act.
Eligibility Requirements
Applicant Eligibility
Public, profit-motivated sponsors, limited distribution, nonprofit cooperative, builder-seller, investor-sponsor, and general mortgagors.
Beneficiary Eligibility
All families are eligible to occupy dwellings in a structure whose mortgage is insured under the program, subject to normal tenant selection. There are no income limits. Projects may be designed specifically for the elderly and handicapped.
Credentials/Documentation
Documentation regarding the characteristics of the property and the qualifications of the mortgagor are assembled by the mortgagee and submitted with the application. This program is excluded from coverage under 2 CFR 200, Subpart E - Cost Principles.
Aplication and Award Process
Preapplication Coordination
Preapplication coordination is required.
An environmental impact assessment is required for this program.
This program is eligible for coverage under E.O.
12372, 'Intergovernmental Review of Federal Programs.' An applicant should consult the office or official designated as the single point of contact in his or her State for more information on the process the State requires to be followed in applying for assistance, if the State has selected the program for review.
Application Procedures
This program is excluded from coverage under 2 CFR 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. For Traditional Application Process (TAP) following HUD's issuance of a SAMA letter (new construction) or Feasibility Letter (substantial rehabilitation) the sponsor submits a formal mortgage insurance application through a HUD-approved mortgagee to the local HUD Multifamily Hub and Program Center for processing. For Multifamily Accelerated Processing (MAP), the lender submits the required exhibits, including a full underwriting package, which are then reviewed by the Multifamily Hub and Program Center before a Firm Commitment is issued.
Award Procedures
The local HUD Multifamily Hub and Program Center reviews the application to determine whether the proposal is feasible. Considerations include market need, zoning, architectural merits, capabilities of sponsors, availability of community resources, etc. If the project meets program requirements, the HUD Multifamily Hub and Program Center issues the lender a commitment to insure the project mortgage.
Deadlines
Not Applicable.
Authorization
National Housing Act, as amended, Section 221, Public Law 86-372, 12 U.S.C. 1715(1).
Range of Approval/Disapproval Time
Processing time depends upon the degree of preparation by the sponsor and whether or not TAP or MAP is used.
Appeals
If an application for mortgage insurance is refused, HUD will state the reasons for the refusal. If reapplication is desired, the applicant may modify the application and reapply.
Renewals
The term of a commitment to insure may be extended under certain circumstances when more time is required.
Assistance Considerations
Formula and Matching Requirements
Statutory Formula: Title 24 cfr, Part 221. This program has no matching requirements. MOE requirements are not applicable to this program.
Length and Time Phasing of Assistance
The maximum mortgage term is 40 years, or not in excess of three-fourths of the remaining economic life, whichever is less. See the following for information on how assistance is awarded/released: Over the life of the mortgage.
Post Assistance Requirements
Reports
No reports are required.
Audits
In accordance with the provisions of 2 CFR 200, Subpart F - Audit Requirements, non-Federal entities that expend financial assistance of $750,000 or more in Federal awards will have a single or a program-specific audit conducted for that year. Non-Federal entities that expend less than $750,000 a year in Federal awards are exempt from Federal audit requirements for that year, except as noted in 2 CFR 200.503. The Department of Housing and Urban Development reserves the right to audit the accounts of either the mortgagee or mortgagor in order to determine their compliance and conformance with HUD regulations and standards.
Records
Mortgagees are required to service and maintain records in accordance with acceptable mortgage practices of prudent lending institutions and the HUD regulations.
Financial Information
Account Identification
86-4077-0-3-371.
Obigations
(Guaranteed/Insured Loans) FY 15 $3,362,376,350; FY 16 est $3,541,142,939; and FY 17 est $3,786,731,323
Range and Average of Financial Assistance
No Data Available.
Regulations, Guidelines, and Literature
24 CFR 221 et seq.; Fact Sheet: Rental Housing for Moderate Income Families, no charge; HUD Handbook 4560.2, Mortgage Insurance for Moderate-Income Housing Projects, Section 221 (d)(4), no charge; HUD Handbook 4560.1,HUD Handbook 4560.3, Mortgage Insurance for Single Room Occupancy Projects; no charge; HUD Handbook 4550.3; Basic Cooperative Housing Insurance Handbook, no charge. Handbooks are on HUDCLIPS at http://www.hudclips.org. The Multifamily Accelerated Processing (MAP) Guide is on the web. Refer to HUD's MAP page at http://www.hud.gov/offices/hsg/mfh/map/maphome.cfm.
Information Contacts
Regional or Local Office
See Regional Agency Offices. Persons are encouraged to contact the Multifamily Hub or Program Center with jurisdiction for the proposed project. HUD Multifamily Hubs or Program Centers are listed at http://www.hud.gov/offices/hsg/mfh/mfbroch/hubs_pcs.cfm or in the Catalog Address Appendix IV.
Headquarters Office
Carmelita James 451 Seventh Street SW, Washington, District of Columbia 20410 Email: carmelita_a._james@hud.gov Phone: (202) 402-2579
Criteria for Selecting Proposals
Not Applicable.
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