Construction or Substantial Rehabilitation

FHA 232
We are obsessed with quality and perpetual improvement. As we get to know you, our approach will be optimized and tailored toward your transactional objectives.
  • Loan Term:40 years (preceded by interest-only period during construction)
  • Interest Rate:Fixed rate, fully amortizing (preceded by interest-only period during construction)
  • Non-recourse:Non-recourse
  • Assumable:Fully assumable
  • Prepayment:10% year one, then declining 1% per year; and customizable
  • Commercial Space:No commercial space greater than 10% of gross floor area and 15% of gross income of the property
  • Borrower:A single asset SPE
  • Escrows:Preconstruction. Escrows required for taxes, interest reserves, insurance, working capital (4% of the loan), and initial operating deficit. Balances will be released to borrower after 6 consecutive months of break-even operations.Post-Construction. Escrows required for taxes, insurance, and MIP and capital needs replacement reserves.
  • Davis Bacon Wages:Payment of prevailing wages for contractors and subcontractors
  • Third Party Reports:Appraisal, Environmental Report, and Capital Needs Assessment
DSCR/LTV Requirements:
  • Property Type
  • Maximum LTV
  • Maximum LTC
  • Minimum DSCR
  • Assisted Living
  • 75%
  • 90%
  • 1.45
  • Skilled Nursing
  • 80%
  • 90%
  • 1.45

Mortgage Insurance Premium:

Standard: 0.77% at HUD closing and annually thereafter (0.45% annually for certain LIHTC projects).Green: 0.25% at closing and annually thereafter

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