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| Featured: National FHA/HUD Lender |
| Overview: | Fantini & Gorga serves as correspondent for Eastern Mortgage Capital, a national MAP Lender with a total focus on FHA-insured financing for apartments and senior housing. Loan amounts on multifamily can reach 85%-90% of value, with a low 35-year fixed rate/ 35-year amortization, non-recourse with no carveouts, and attractive prepayment structures. |
| Loan Amount: | $3,000,000 to $50,000,000+. (Note the program has no minimum amount and smaller loans may be considered, but transaction costs tend to make most loans under $3.0M uneconomic) |
| Terms: | 35- year fixed rate |
| Amortization: | 35- years (no balloon) |
| Property Profile: | Apartments, both market rate and affordable (including Section 8 contracts and rent restrictions); elderly housing, assisted living, and skilled nursing. All markets - urban, suburban, and small town. Same underwriting/ loan terms for all markets |
| Underwriting Criteria: | Market rate apartments: 85% loan to value/ LTV (80% with cash out), 1.18 debt coverage/DCR Affordable apartments: 90% LTV (80% with cash out), 1.11-1.15 DCR. Nursing/ assisted living: call for specifics |
| Interest Rates/MIP: | Bid competitively through the Ginnie Mae market. Along with debt service the borrower pays monthly installments of a Mortgage Insurance Premium (MIP) - 0.60% yr. for market rate, .25% for affordable and "green" projects. Current 35- year fixed rates plus MIP are less than comparable 10- year rates from Fannie, Freddie, CMBS, and banks. Call us for current rates. |
| Rate Lock: | Rate is locked at commitment and can be held up to 6 months. |
| Prepayment: | Typically, annual declining percent over 10 years: 10%/9%/8% to 1% in year 10. Last 25 years open with no penalty. More flexible structures are available for a premium in rate. |
| Process/Timing: | After being engaged, for permanent loans Lender prepares a Firm Application to file with HUD (US Dept. of Housing and Urban Development) - includes appraisal, engineering, and environmental reports; timing typically 75-90 days. HUD issues a mortgage commitment from FHA (Federal Housing Administration). Borrower locks rate and normally closes within 30-45 days (or up to 6 months forward if borrower elects). HUD processing times vary by transaction type; call us for specifics. |
| Fees/Costs: | HUD fees: 1.3% (0.55% for affordable and "green;" lender legal $21,000-$25,000; standard report costs. No lender fee if loan is originated through F&G as correspondent; normal F&G fee is 1% |
| Recourse: | Non-recourse with no carveouts |
| Assumption/Rate Reset: | Multiple assumptions allowed, 1% fee. Program also provides for streamlined rate re-sets. |
| Escrows: | Real estate taxes, insurance, replacement reserves, plus any engineer-mandated repairs. |
| Observation: | This program provides an attractive, full-proceeds takeout loan for new projects and maximum cash-out refinances, market rate properties in smaller markets, and affordable properties of all kinds. |
