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.
Uses and Use Restrictions
The SRO Program insures lenders against loss on mortgages used to finance construction or substantial rehabilitation of projects consisting of five or more units comprised primarily of one room residential units.
Projects must be designed primarily for residential use.
Any commercial activity must be compatible with the use of the project and primarily for the benefit of the residents.
Commercial space is limited to 10 percent of the total gross floor area (20 percent in substantial rehabilitation projects), and 15 percent of gross rental income in a project.
Contractors for new construction and substantial rehabilitation projects must comply with prevailing wage requirements under the Davis-Bacon Act.
Eligible applicants may be nonprofit entities; builder/sellers teamed with a nonprofit purchaser, a limited distribution entity, profit-motivated entities or public entities.
Cooperative lenders or investors are not eligible.
Residents are subject to normal tenant selection procedures. There are no income limits for admission.
Along with the Application for Mortgage Insurance, the applicant must provide a market profile demonstrating a clear need for the proposed SRO, experience profiles as to SRO operation, a certification from the local government assuring support of the project, and a relocation plan if needed. This program is excluded from coverage under 2 CFR 200, Subpart E - Cost Principles.
Aplication and Award Process
Preapplication coordination is required.
An environmental impact assessment is required for this program.
This program is excluded from coverage under E.O.
This program is excluded from coverage under 2 CFR 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. The sponsor submits an application for a SAMA or feasibility application to the local HUD office for review. Following HUD's issuance of a SAMA or feasibility letter, the sponsor submits a firm commitment application through a HUD-approved mortgagee to the local HUD Multifamily Hub and Program Center for processing.
The project is reviewed to determine its feasibility. If the project meets program requirements, the HUD Multifamily Hub or Program Center issues a commitment to insure the mortgage.
National Housing Act, Section 221(d), 12 U.S.C. 1751(d); Section 223(g), 12 U.S.C. 1715 (g).
Range of Approval/Disapproval Time
Processing time depends upon the degree of preparation by the sponsor and the workload of the HUD Multifamily Hub or Program Center.
If an application for mortgage insurance is denied, HUD will state the reasons for the denial. If reapplication is desired, the applicant may reapply subject to concurrence of the lender.
The term of a commitment to insure may be extended when more time is required to close the loan.
Formula and Matching Requirements
Statutory Formula: Title 24 CFR, Part 221. This program has no matching requirements. This program does not have MOE requirements.
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
No reports are required.
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 to determine their compliance and conformance with HUD regulations and standards.
Mortgagees are required to service and maintain records in accordance with acceptable mortgage practices of prudent lending institutions and HUD regulations.
(Guaranteed/Insured Loans) FY 15 Not Separately Identifiable(Exp: Reported under 14.135); FY 16 Not Separately Identifiable(Exp: Reported under 14.135); and FY 17 Not Separately Identifiable(Exp: Reported under 14.135) - Reported under 14.135.
Range and Average of Financial Assistance
No Data Available.
Regulations, Guidelines, and Literature
24 CFR 221.565; HUD Handbook 4560.3, Mortgage Insurance for Single Room Occupancy (SRO) Projects available on www.hudclips.org.
Regional or Local Office
See Regional Agency Offices. Persons are encouraged to communicate with the nearest local HUD Multifamily Hub and Program Center listed in http://www.hud.gov/offices/hsg/mfh/mfbroch/hubs_pcs.cfm or the nearestHUD Office listed in the Catalog Address Appendix IV.
Carmelita James 451 Seventh Street SW, Washington, District of Columbia 20410 Email: email@example.com Phone: (202) 402-2579
Criteria for Selecting Proposals
Justine Sheu didn’t have any plans of becoming an entrepreneur. The Detroit-based millennial spent her early career educating underserved youth in the area. But with the backing of a funding initiative specifically targeted to boost women and minority entrepreneurs in Southeast Michigan, Sheu cofounded two education-technology startups.
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