FHA Section 241(a)7 Mortgage Insurance Program

PURPOSE To provide funding repairs, additions, and improvements to multifamily rental housing and healthcare facilities with FHA insured first mortgages or HUD-held mortgages. ELIGIBLE PROJECTS Insured mortgages may finance either: (1) Additions and improvements of multifamily housing projects, nursing homes, hospitals, and assisted living facilities already subject to HUD/FHA insured mortgages or mortgages held by HUD (2) Finance energy conservation improvements. The proceeds of a loan involving an insured nursing home, hospital or assisted living facility may also be used to purchase equipment to be used in the operation of the facility. Major moveable equipment for insured nursing homes, group practice facilities, or hospitals may be covered by a mortgage under this program. INTEREST RATE Fixed-rate, based on the sale of GNMA securities, market tax-exempt or taxable bonds. LOAN TERM The amortization period is not to exceed the remaining term of the first mortgage. DAVIS BACON WAGE The Department of Labor’s published wage and fringe benefits must be paid during construction. MAXIMUM MORTGAGE AMOUNT The principal amount of the loan shall not exceed: (1) 90% of the HUD-FHA estimated value of the improvements, additions, or equipment, or (2) An amount which when added to any outstanding indebtedness relating to the property, does not exceed the maximum mortgage amount currently insurable under the Section or Title pursuant to which the mortgage covering such project or facility is insured. Nothing contained herein is intended to be, nor should it be construed as, a commitment to lend on these or any other terms. Arizona MB007451