Mortgage Insurance for the Purchase or Refinancing of Existing Multifamily Housing Projects (14.155)

Program

14.155 Mortgage Insurance for the Purchase or Refinancing of Existing Multifamily Housing Projects

Federal Agency

Agency: Department of Housing and Urban Development
Office: Office Of Housing-federal Housing Commissioner

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.

Program Number

14.155

Last Known Status

Active

Objectives

To provide mortgage insurance to HUD-approved lenders for the purchase or refinancing of existing multifamily housing projects, whether conventionally financed or subject to federally insured mortgages at the time of application for mortgage insurance. The program allows for the long term mortgages that can be financed with Ginnie Mae Mortgage-Backed Securities.

Types of Assistance

GUARANTEED/INSURED LOANS

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. Only projects not requiring substantial rehabilitation are acceptable under this section. The estimated cost of required repairs may not exceed 15 percent of the estimated value after repairs or $6,500 per unit adjusted by a high cost factor, whichever is greater and may not involve the replacement of more than one major system. The program has statutory per unit 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-value and debt service limitations. Prevailing wage requirements under the Davis-Bacon Act do not apply to this program.

Eligibility Requirements

Applicant Eligibility

Mortgagors may be either private or public. The property must consist of not less than 5 living units and must meet the following criteria: (1) the mortgage cannot exceed 85 percent of the HUD estimated value of the project; (2) three years must have elapsed from the later date of completion of project construction or substantial rehabilitation, or the beginning occupancy date of application for mortgage insurance; (3) the remaining economic life of the project must be long enough to permit at least a ten-year mortgage term or 75 percent of the estimated life of the physical improvements.

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 OMB Circular No. A-87. This program is excluded from coverage under OMB Circular No. A-87.

Application 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 Procedure

This program is excluded from coverage under OMB Circular No. A-102. This program is excluded from coverage under OMB Circular No. A-110. The applicant will submit a formal application for conditional or firm commitment through a HUD approved mortgagee. This program is excluded from coverage under OMB Circular No. A-110. An environmental assessment is required.

Award Procedure

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.

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

Audits

This program is excluded from coverage under OMB Circular No. A-133. 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.

Program Accomplishments

Not Applicable.

Financial Information

Account Identification

86-4077-0-3-371.

Obligations

(Guaranteed/Insured Loans) FY 08 $1,129,375,200; FY 09 est $1,350,000,000; FY 10 est $1,550,000,000

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.

Related Programs

Not Applicable.

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

Joyce Allen 451 Seventh Street SW, washington, District of Columbia 20410 Email: joyce.allen@hud.gov Phone: 2027081142

Web Site Address

http://www.hud.gov/offices/hsg/hsgmulti.cfm.

Examples of Funded Projects

Not Applicable.

Criteria for Selecting Proposals

Not Applicable.