Subject to Davis-Bacon requirements. Audited project financial statements must be filed annually with CMI.
Full escrows for property taxes and all applicable insurance are funded at closing and must be maintained throughout the life of the loan. A Replacement Reserve account must be established at closing and is made immediately available for replacement of short-lived depreciable items. An Operating Deficit escrow will be required by HUD to cover operating losses until sustaining occupancy is reached and must be funded by with cash or a letter of credit.
This is a non-recourse loan. Long loan term - up to 25 years, fully-amortizing. Low, fixed interest rates, fully amortizing. Loan-to-cost ratio up to 90% (includes major movable equipment). Loan-to-value ratio for rehabilitation and refinance up to 90%, with a minimum of 20% (10% equipment) of the mortgage amount attributable to rehabilitation. Most affirmative and negative loan covenants typically found in conventional loan agreements are eliminated. Converts to permanent financing upon completion at no extra cost. Fully assumable, subject to HUD and CMI approval. Can be used as a credit enhancement for tax exempt bonds.
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