ACQUISITION AND REFINANCE LOANS FOR EXISTING NURSING
HOME & ASSISTED LIVING FACILITIES
FHA SECTION 232 PURSUANT TO SECTION 223(f)

Eligible Projects include 1) the acquisition, and 2) the refinance of existing Nursing Homes and Health Care Facilities nationwide. To qualify, a facility must be at least three (3) years old from the date of issuance of the certificate of occupancy (or) from the date of completion of a substantial rehabilitation of the project to the date of filing the application with FHA.

Minor repairs and replacements, while not a requirement for eligibility, are allowed and are payable from mortgage proceeds. However, such repairs cannot exceed 15% of HUD's final estimate of value after repairs (or) $6,500 times the applicable high cost factor on a per unit basis. Additionally, no more than one major building system may be replaced, i.e., roofs, HVAC systems, windows, etc. Appliances and life-safety systems and equipment are exempt from these limits.

Nationwide

up to $100,000,000

• Acquisition or Refinance of Existing Nursing Homes, Assisted Living Facilities, and Health Care Facilities
• Substantial Rehabilitation is not allowed
• Up to 35 year term
• Up to 85% loan-to-value ratio for profit motivated mortgagors
  and 90% LTV for not-for-profit-mortgagors
• Up to a 100% loan-to-cost mortgage
• Minimum debt service coverage 1.18% (85% of NOI)
• Fully amortizing
• Fully assumable
• Low, fixed interest rates
• Non-recourse
• No rent control restrictions
• No limitation on owner’s return
• Pre-payable with restrictions
• Mortgage proceeds may be used to pay for acquisition or refinancing costs, including the hard cost of repairs, replacements, improvements, initial deposit to replacement reserve, and major movable equipment.

Cash out is NOT permitted.

Secondary financing is permitted by HUD, however, the aggregate amount of the insured first mortgage and the second mortgage cannot exceed 92.5% of HUD's established Fair Market Value of the project.

Negotiable. Typically ranging from a five-year lockout to a ten-year lockout, with or without a declining prepayment penalty in the five years beyond the lockout period of 5%, 4%, 3%, 2%, 1%, 0%. The note interest rate will be adjusted according to the selected lockout/prepayment terms.