FHA Section 232/223(a)(7)
Mortgage Insurance for Skilled Nursing & Assisted Living Facilities
Refinance of Existing FHA Insured Loans
The 232/223(a)(7) Program is insured by the Federal Housing Administration (FHA) and provides skilled nursing, assisted living, memory care, and other residential care facilities access to affordable financing nationwide. This streamlined program allows borrowers with existing FHA-insured loans to lower the interest rate, fund project repairs and (in limited circumstances) extend the loan term.
All borrowers with existing FHA 232 mortgages may apply under this program.
FHA may approve a term of up to 12 years beyond the remaining term of the existing mortgage, not to exceed the original term.
The lesser of:
• Original principal amount of existing insured mortgage loan
• Unpaid principal amount of the existing insured mortgage loan plus loan closing charges, prepayment penalties associated with refinancing the mortgage loan, and costs of repairs
• Debt service coverage at 1.11:1
Fixed interest rate, subject to market conditions
Qualifies for Ginnie Mae government guaranteed mortgage-backed securities, direct placement or may be used to credit enhance tax-exempt or taxable bonds.
This program is processed under FHA’s LEAN guidelines which employ a standardized work product and aim for a consistent, timely result.
None, FHA is non-recourse.
FHA application fee, inspection fee, lender fees and mortgage insurance premiums will be collected. Various third party reports may be required. All of these costs are eligible for inclusion in the mortgage note and are reimbursable to client at closing.
- Replacement reserve balance must be transferred in full at closing.
- Existing commercial space is permitted.
- An annual audit of operations is required to be submitted to HUD and Oppenheimer.
- Condensed list of application exhibits, far less than regular FHA application.
- Appraisal, Phase I Environmental Site Assessment and Survey are NOT required in most instances. PCNA is required if one has not been completed within the past ten years or if seeking a term extension.
This is a general outline of the program requirements. For complete information and to determine how your property can benefit from this accelerated financing opportunity, please contact your Oppenheimer representative at [email protected], or call (215) 631-9151.
“As a not for profit senior independent housing project that was originally built in 1984 and is HUD insured, we felt it crucial for our strategic plan to refinance our mortgage while interest rates were low. We immediately went to Oppenheimer’s Bob Corp. We knew through vast professionals who we work with closely, that Oppenheimer Multifamily & Healthcare Finance, Inc. was well versed in refinancing concurrently working with HUD and their regulations. Although it was an arduous process, Oppenheimer was able to work with all the disciplines and create a refinancing package that extended our mission of serving seniors in a gracious living environment for decades to come. It was a joy to work with this group! I wish I had another facility to refinance! Financing completed October 1. 2013.”
Rev. Carol D. Jubenville
The Community at Sunset Wood