Mortgage Banking
FHA Financing Programs
FHA 242 for a 242 Insured Mortgage - New Construction, Substantial Rehab, Moderization, Hospital Finance Program - Permanent Financing Programs
PROJECT CRITERIA
Hospital and critical access hospitals
New construction, substantial rehabilitation, modernization, remodeling, equipment and expansions, or refinances that involve accessing at least 20% in new money proceeds
Davis Bacon labor standards and prevailing wage requirement shall apply to construction and rehabilitation projects
MORTGAGE TERMS
Fixed rate, level amortization, non recourse, fully assumable, 100% insured by FHA
Term:
New construction / substantial rehabilitation - up to 25 years permanent loan plus construction period
LOAN TO VALUE
New Construction/Substantial Rehabilitation
90% LTV
Debt service coverage ratio: 1.25 minimum
INTEREST RATES
Quoted based upon market
May use tax exempt bonds
May use taxable low interest GNMA Mortgage Backed Securities, or whole loans (pension fund sources)
PREPAYMENT PENALTIES/LOCKOUTS
No yield maintenance requirement
Prepayment lockout, penalties are negotiated between investor and borrower at the time of interest rate lock
FINANCING COSTS
Paid at application:
To FHA - $3.00 per thousand of requested mortgage amount
Paid at closing:
Financing processing/placement fee
Applicable GNMA, or private financing discount fees
MIP (up-front) to FHA:
1/2% per year for construction loans
Processing Fees paid to FHA:
0.50% of mortgage amount - inspection fee
0.15% of mortgage amount - application fee
0.15% of mortgage amount - commitment fee
ANNUAL FEES
MIP to FHA:
0.50% per year for permanent loan
GNMA guaranty servicing fees:
0.25% to .50% annual GNMA Guarantee Fee/Servicing Fee
CLOSING REQUIREMENTS
Mortgage Reserve Fund:
The borrower will agree to make monthly payments into a mortgage reserve fund which will build to one year of debt service after five years and two years of debt service after ten years.
Certificate of Need
A certificate of need is required if the borrower is in a certificate of need state.
THIRD PARTY REPORTS OBTAINED BY LENDERS
Appraisal
Market Analysis
Feasibility Study
Environmental Study
Lender's due diligence
Survey
Other
Information above is subject to change. Information is available on other FHA programs upon request.