Acquisitions

HUD/FHA Section 232 Mortgage Insurance

Purpose

Attractive, long-term, fixed-rate loans for the acquisition of nursing homes, intermediate care facilities, assisted living facilities, mental health and rehabilitation properties, and board & care homes. Projects may include combinations of the above levels of care.

Eligibility

Existing projects that have been occupied for at least three years and do not require substantial rehabilitation are eligible. Projects requiring rehabilitation qualify under the substantial rehabilitation program guidelines. Facilities requiring entrance fees are not eligible.

Loan Features

• No personal recourse.
• Low, fixed-rate interest.
• Amortization based on the lesser of 35 years or 75% of the project's remaining economic life.
• Loan amount is for the lesser of: up to 85% of HUD appraised value (90% for non-profit borrowers), a mortgage amount supported by 85% of net income (90% for non-profit), or 85% of acquisition cost (90% for non-profit).
• Borrower must provide HUD with annual audited financial statements for the mortgagor entity.
• Fully assumable with negotiable prepayment provisions.