Healthcare Acquisition or Refinance Program
Senior Housing/Health care
Section 232/223(f)
Acquisition or Refinance
Overview:
Insured mortgages may be used to finance Purchase or Refinance of existing , board and care homes, assisted living facilities , nursing homes and specialized use facilities such as Alzheimer’s or alcohol and drug treatment facilities. Facilities must be licensed. Limited Independent Living units may be allowed, subject to limitations and conditions.
Eligible Borrowers:
• Single Asset Entity
• For profit or nonprofit
Terms:
• Up to 35 Years
Loan Benefits:
• Non-recourse
• Fully assumable
• Credit enhancement of Housing Bonds providing for AAA rating
Rates:
• Fixed for the length of the mortgage
Processing:
• Eligible for Lean 232 Processing (LEAN).
Liability Insurance Requirement:
• Required limits apply
Mortgage Limitations:
Refinance (No Cash Out)
The maximum insured mortgage will be the lesser of:
• A mortgage supported by 1.177 debt coverage (85% 0f net income); 1.12 debt coverage for nonprofit borrowers (90% of net income)
• 85% of appraised value (90% for nonprofit borrowers)
• 100% existing debt plus loan costs, including replacement reserves and repairs
Purchase
The maximum insured mortgage will be the lesser of:
• A mortgage supported by 1.177 debt coverage (85% 0f net income); 1.12 debt coverage for nonprofit borrowers (90% of net income)
• 85% of appraised value (90% for nonprofit borrowers)
• 85% of acquisition cost including loan costs, replacement reserves and repairs (90% for nonprofit borrowers)
Secondary financing:
• Permitted; special conditions apply.
Prepayment Terms:
• Typically a 5-Year lockout then open to prepayment at 105% in year 5, declining 1% per year for years 6 through 10, then 0%
