Loan Type: | HUD/FHA - 232/223(f) - fixed-rate, non-recourse, permanent loan | |||
Property Type: | Licensed skilled nursing, assisted living, and board and care facilities with limited independent living units. | |||
Purpose: | Purchase or refinance, along with moderate repairs/improvements. For-profit, nonprofit and public borrowers may utilize this program. | |||
Eligibility: | The facility must have been completed or substantially rehabilitated for at least three years prior to the date of the firm commitment. Moderate improvements to the property are permitted and can be built into the financing request. Borrower must be a single-asset entity. | |||
Amount: | Unlimited, prefer $3 million or greater | |||
Loan-To-Value: | For purchase transactions, the lesser of 85% (for-profits) or 90% (nonprofits) of the acquisition price or appraised value. For refinance transactions, the lesser of 100% of the cost to finance or 85% (for-profits) or 90% (nonprofits) of the appraised value. Loan requests nearing statutory maximum LTVs will receive additional credit scrutiny. | |||
Debt Service Coverage: | Minimum 1.11x for nonprofit borrowers; 1.17x for for-profit t borrowers | |||
Interest Rate: | Fixed rate subject to market conditions at rate lock | |||
Term: | Up to 35 years | |||
Amortization: | Up to 35 years | |||
Liability: | Non-recourse loan | |||
Assumability: | Yes, with FHA approval | |||
Prepayment: | Typically, 2-year lockout with fixed declining thereafter | |||
Escrows: | Monthly escrows for property insurance, real estate taxes, reserves for replacement and mortgage insurance premiums. | |||
Fees & Expenses: | Borrower is responsible for due diligence, transaction and legal fees. At time of closing, these fees and all other closing costs may be included in the loan amount. | |||
Timing: | Under the LEAN process this transaction can typically be completed in as short as 3-4months. Actual processing times vary depending on the complexity of the project and information available from the borrower. | |||
Post-closing Reporting: | Annual audited financial statements | |||