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We work across the US. Most recent closings in North Carolina • Colorado • Ohio • Pennsylvania

Markets
  • JS MultiCapital Corporation
  • 2000 Auburn Drive, Suite 200
  • Beachwood, OH 44122
  • ph (216) 765-9000
  • fx (440) 919-0270

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HUD 223(f)

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Purpose: This program provides mortgage insurance for refinancing, acquisition, or moderate rehabilitation of existing projects.

Eligible Properties: The apartment project must be at least 3 years old. Commercial space is permitted but shall not exceed 20% of total square footage or 20% of gross income. Waivers require HUD approval.

Interest Rate: FIxed for the term of the loan as stated in the note. Subject to market conditions

Term of Loan: The lesser of 35 years or 75% of the remaining economic life of the property.

Maximum mortgage limitations: In general the maximum mortgage limitations for the Section 223(f) program are as follows:

1. For a purchase transaction, the lesser of:

  • 83.3% of HUD appraised value,
  • 83.3% of acquisition cost,
  • Section 207 statutory per unit limits, adjusted by the local Field Office high cost percentage for the locality, or
  • A mortgage amount supported by 1.20 debt coverage (83.3% of net income).

2. For a refinance transaction, the lesser of:

  • 83.3% of HUD appraised value,
  • Section 207 statutory per unit limits, adjusted by the local Field Office high cost percentage for the locality,
  • A mortgage amount supported by 1.20 debt coverage (83.3% of net income).
  • The greater of the cost to refinance or 80% of HUD appraised value

Commercial Income: Residential income must be calculated separately from the commercial income, vacancy and collection loss, operating expenses and replacement reserves attributed to commercial space.

Residential Income: Other income may be included with rental income such as, laundry facilities, pet fees, vending machines, etc.

Personal Liability: None. The loan is non-recourse.

Prepayment: Prepayable up to the amount determined at the time the loan is placed with an investor.

Prepayment provisions: Lockout period followed by declining balance penalty.

Secondary Financing: Allowed up to 92.5% of the Appraised Value of the property when added to the FHA Insured Mortgage.

Repairs: Funds for repairs can be included in the loan amount up to 15% of value or $6,500 per unit times the area high cost ratio.

Escrows: Cash Escrows are required for the payment of taxes and insurance.

Replacement Reserves: Cash escrows are required as determined by the property inspection report.







Contact Kathryn Cassidy
For a personal, confidential
discussion about your
project (216) 765-9000