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Mortgage Insurance for the Purchase or Refinancing of Existing Multifamily Housing Projects
The program allows for the long term mortgages
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 communicate with the nearest local HUD Multifamily Hub or Program Center listed at http://www.hud.gov/offices/hsg/mfh/mfbroch/hubs_pcs.cfm or the nearest HUD Field Office listed in Appendix IV.
Program Accomplishments
Not Applicable.
Uses and Use Restrictions
Section 223(f) insures lenders against loss on mortgage loans.
These loans may be used to purchase or refinance existing multifamily housing projects.
The property must contain at least 5 residential units with complete kitchens and baths and have been completed or substantially rehabilitated for at least 3 years prior to the date of the application for mortgage insurance.
The program allows for non-critical repairs that must be completed within 12 months of loan closing.
Projects requiring substantial rehabilitation are not acceptable under this section and may not involve the replacement of more than one major system.
The remaining economic life of the project must be long enough to permit a ten-year mortgage.
The mortgage term cannot exceed 35 years or 75 percent of the estimated life of the physical improvements, whichever is less.
Davis Bacon prevailing wage requirements do not apply to this program.
The applicable percentage of the estimated value of the property after completion of repairs and improvements.
90% - for Section 202/202/8 Direct Loans, 87% - for projects with 90% or greater rental assistance, 85% for projects that meet the definition of Affordable Housing, and 83.3% for market rate projects.
Eligibility Requirements
Applicant Eligibility
Mortgagors may be either profit and non-profit.
Beneficiary Eligibility
All persons are eligible to occupy such projects subject to normal occupancy restrictions.
Credentials/Documentation
Documentation regarding the characteristics of the property and the qualifications of the purchaser or existing mortgagor in refinance projects are assembled by the mortgagee and submitted with the application. Management plan must be submitted at time of application for commitment. This program is excluded from coverage under 2 CFR 200, Subpart E - Cost Principles.
Aplication and Award Process
Preapplication Coordination
Preapplication coordination is required.
Environmental impact information is not required for this program.
This program is excluded from coverage under E.O.
12372.
Application Procedures
This program is excluded from coverage under 2 CFR 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. The applicant will submit a formal application for conditional or firm commitment through a HUD approved mortgagee.
Award Procedures
The local HUD Multifamily Hub and Program Center reviews the application to determine proposal eligibility. If the project meets program requirements, the local HUD Multifamily Hub and Program Center issues the commitment to the lender to insure the project.
Deadlines
Not Applicable.
Authorization
National Housing Act, Section 223(f), as amended; Housing and Community Development Act of 1974, as amended, Public Law 93-383. 12 U.S.C. 1715n.
Range of Approval/Disapproval Time
Processing time depends on the degree of preparation of the sponsor, and whether MAP or TAP is used.
Appeals
If an application for mortgage insurance is denied, HUD will state the reasons for denial.
Renewals
The term of a commitment to insure may be extended under certain circumstances when more time is required to close the loan.
Assistance Considerations
Formula and Matching Requirements
This program has no statutory formula. This program has no matching requirements. This program does not have MOE requirements.
Length and Time Phasing of Assistance
The mortgage term should not be less than 10 years nor should it exceed the lesser of 35 years or 75 percent of the estimated remaining economic life of the physical improvements. See the following for information on how assistance is awarded/released: Over the life of the loan.
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 Not Separately Identifiable(Exp: Reported under 14.134); FY 16 Not Separately Identifiable(Exp: Reported under 14.134); and FY 17 Not Separately Identifiable(Exp: Reported under 14.134)
Range and Average of Financial Assistance
No Data Available.
Regulations, Guidelines, and Literature
Fact Sheet, Section 223(f) Mortgage Insurance; 24 CFR 200, HUD Handbook 4565.1, Mortgage Insurance for the purchase or Refinancing of Existing Multifamily Housing Projects, Section 223(f) available on www.hudclips.org. The Multifamily Accelerated Processing (MAP) guide may be found 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 communicate with the nearest local HUD Multifamily Hub or Program Center listed at http://www.hud.gov/offices/hsg/mfh/mfbroch/hubs_pcs.cfm or the nearest HUD Field Office listed in 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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