FHA 232/223F LEAN Loans Nationally
Assisted Living Facility - Nursing Home Loans

FHA - 232/223(f) - Refinance or Purchase of Skilled Nursing and
Assisted Living Facilities - Senior Housing Finance

ELIGIBLE PROPERTIES: Skilled nursing assisted living, intermediate care and board and care facilities,
or any combination - Moderate rehabilitation is permitted.  LOAN TYPE: Permanent loan. Min. FHA
232/223 F $3,000,000

MAXIMUM LOAN: The lesser of the following criteria:-
1.  80% of HUD appraised value; Assisted Living SEE:  LTV  DSC CHART
2.  1.45 debt service coverage.
Refinance Transaction:
1. The existing indebtedness plus transaction costs.
Purchase Transaction:
1. 80% of the cost of acquisition.- Assisted Living

INTEREST RATES: Fixed rate determined by market rates at the time of rate lock.

AMORTIZATION: Up to 35-year, fully amortizing loan.


ASSUMABILITY: Assumable, subject to approval.

SUBORDINATE FINANCING: Allowable, subject to HUD criteria.


ANNUAL MORTGAGE INSURANCE PREMIUM: 1.0% of the mortgage amount is payable at closing.
Thereafter, the MIP is escrowed monthly based on a rate established by HUD. The rate is fixed at loan

ESCROWS: Monthly escrows for property insurance, real estate taxes, reserves for replacement,
sinking fund (if applicable) and mortgage insurance premiums. An initial deposit to replacement reserve
and 100% of repair costs (both as determined by HUD) are escrowed from mortgage proceeds.

COMMERCIAL SPACE: Commercial area shall not exceed 20% of the total net rentable area of the
project and commercial income shall not exceed 20% of effective gross income.

ENVIRONMENTAL ISSUES: Special rules apply for properties which are located in Flood Hazard Zones
as designated by FEMA. Lead-based paint and asbestos must be abated in accordance with HUD

APPLICATION FEE: A non-refundable fee of 0.3% of the requested mortgage amount is payable to HUD
at the time of application, plus estimated underwriting costs for market study, appraisal,
architectural/engineering report, cost analysis, environmental assessment and other loan processing


CLOSING EXPENSES: Standard transaction costs, including legal fees, title insurance and survey.

PROFESSIONAL LIABILITY INSURANCE: Required by HUD for all loans. The minimum requirement is $1
million per occurrence and $3 million aggregate. Further information regarding this requirement is
available upon request.

STATE LICENSURE: All loans must be licensed by the state or other governmental entity who has
oversight responsibilities.

OTHER HUD REQUIREMENTS: Cash escrows or letters of credit are required for the following:
1.        20% of repair costs as a completion guarantee.
2.        2.5% of repair costs as a latent defects guarantee, due at completion of repairs.
3.        Forecasted operating deficits, (maximum of 18 months) to be released upon achievement
of  breakeven operations for 90 days.


One stage for HUD Multifamily Accelerated Processing (MAP) procedures:
1.        Firm Commitment Stage: 60 days for review.


Include the following in your request for a loan quote:
1.        Property description and location map.
2.        Number of beds with breakdown of proposed rents by payor source.
3.        Current bed roll and year-to-date operating statement.
4.        Operating history – prior 3 years, if available.
5.        Current year operating budget.
6.        Existing debt or purchase price.
7.        Sponsor resume
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