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The latest in industry news with the insight of Dominion Due Diligence Group (D3G) President, Rob Hazelton

 

RAD FHA Lenders: Frequently Asked Questions

 

D3G is an active participant in the Mortgage Bankers Association (MBA) and has been on monthly conference calls between FHA Lenders and HUD RAD staff.  These calls have been very informative and serve as question and answer sessions to improve the process of RAD transactions using HUD’s multifamily mortgage insurance programs.  

Last week HUD produced a list of “RAD FHA Lenders Frequently Asked Questions” which is a summary of the larger topics discussed over the past 6 months.   

I find two of the more important FAQs for my direct industry to be A (Scattered Sites) and C (RPCA with Section 221(d4) programs). 

Enjoy the new clarifications, and we can expect these FAQs to be incorporated into the revised pending RAD Notice 2012-32 expected in mid-March.

rad_fha_faqs.pdf

HUD RAD Showcase: Spotlight on Recent Closings

Great way to start the new year, as HUD has showcased another RAD Closing for a project Dominion Due Diligence Group (D3G) guided.  HUD has now showcased preservation deals, moderate rehabilitation deals (4% lihtc) and significant rehabilitation deals (9% lihtc) where D3G performed environmental, energy and engineering studies. Link below.

HUD Issued RADBlast! RAD_Newsltr_Dec2014.pdf

November Closing Spotlight: First listed is the project D3G guided. (Top of page 2)

Rental Assistance Demonstration (RAD) & The San Francisco Housing Authority

In light of the recent RAD re authorization (125,000 more units YIPPIE!), I wanted to blog about this great article regarding San Francisco Housing Authority and RAD.  D3G has worked on the San Fran RAD projects for greater than a year with the Mayor’s Office, and it is nice to see good press about the benefits of healthy homes. 

Also the article notes “Early estimates indicate that the RAD financing structure will result in over $500 million in rehabilitation. To put that number into perspective, the Housing Authority only receives $10 million per year for rehabilitation under the current system.”

Here’s wishing a healthy and happy holiday season to San Francisco Housing and their residents!

Full Article Here

UPDATE: HUD issues another clarification on RAD. RPCA studies necessary for 221(d)(4) projects

Is a RAD Property Condition Assessment (RPCA) required on the Section 221(d)(4) transaction?

 

No, an RPCA narrative report is not required on any 221(d)(4) transaction.

However, the RPCA Excel tool is required on all 221(d)(4) sub-rehab projects where the scope of rehab does not include "the removal and replacement of substantially all interior finish surfaces exposing the underlying building frame (i.e. gut rehab).  

For those non-gut rehab transactions, the RPCA tool will be required  1) to size the project's reserve for replacement account's deposit, and 2) to capture it's utility consumption baseline data.

The required portions of the RPCA tool which must be completed include:

a) Utility Baseline - Summary

b) Utility Baseline - Monthly

c) Cap Needs Input

 

For FHA 221(d)(4) new construction and gut rehab transactions, Lenders should use the FHA Section 221(d)(4) formulas to size the reserve for replacement account deposit.

HUD Update: Emergency Call Systems in Elderly Properties

 

Recently HUD’s Office of Multifamily Housing Programs issued clear guidance on the requirements for an Emergency Call System in Elderly Properties.  

The memorandum (dated October 31, 2014) was written to clarify Section 100.2 of HUD’s Minimum Property Standards (MPS), Handbook 4910.1.  

Since the memorandum is moot on the definition of Elderly Housing (e.g. 55 or 62?) we will assume this requirement applies only to the Federally defined 62+ age demographic.

 

Read the full update below:

HUD-Update-Call-Systems-in-Elderly-Properties.pdf

 
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