New Construction or Substantial Rehabilitation
FHA 221(d)(4) Term Sheet
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
Interest Rate
Fixed rate, fully amortizing
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 25% of net rentable area and 20% of effective gross income of the property
Borrower
A single asset SPE
Escrows
Prior to construction, reserves for interest, insurance, taxes, working capital, and initial operating deficit must be established. These balances will be released to the borrower following six consecutive months of break-even operations. Post construction, insurance, taxes, and MIP will be escrowed monthly. Additionally, a capital needs reserve will be maintained with monthly deposits in accordance with HUD guidelines on a property specific basis.
Davis Bacon Wages
Payment of prevailing wages for contractors and subcontractors
Third Party Reports
Market Study, Appraisal, Environmental Report, future Capital Needs Assessment and an Architectural and Cost Review
DSCR/LTV Requirements: For Loan Amounts of $130 Million and Above
Mortgage Insurance Premium: 0.25% due at closing and annually thereafter
- At least 90% of the units covered by a project-based Section 8 contract for at least 15 years.
- Regulatory Agreement in place with minimum set-aside (e.g., 40% of units at 60% AMI, or 20 % of units at 50% AMI) in effect for at least 15 years
Connect with an Expert
Grow with Bravo
Grow with Bravo
Grow with Bravo
Grow with Bravo
Grow with Bravo
Grow with Bravo
