WASHINGTON, DC-The US Department of Housing and Urban Development’s newly launched process of evaluating and processing loans for its Lean 232 funding program, which covers nursing and assisted living facilities, is speeding loan commitments, Cambridge Realty Capital Cos., reports.
HUD began using special queues for loans for this program last month--that is, it established five separate underwriting queues to accommodate the different type of loan applications. “I would say it has cut the wait period for single property refinances by at least two-thirds,” estimates senior vice president Brent Holman-Gomez.
He says that the company recently secured commitments for two loans under the new program that it likely would have had to wait until the new year for under the old regime. “It has been impressive to watch applications that are tied together moving into their own queue, which has freed up space and time for the single property refinancing,” he says.
The queues began with the introduction of a Green Lane to process such low-risk loans HUD 223(a)(7) loans for clients refinancing existing HUD loans. More queues were added to include such factors as cash flow, appraised value, loan-to-value, debt-to-vale, debt service coverage ratio, occupancy and various competitive factors. A point system is used to determine which projects qualify.
Separate queues also have been established for projects that are part of a large or midsize portfolio and for projects that involve new construction, substantial rehabilitation or blended rate applications. The new processing methods come as HUD has been receiving a dramatic increase in loan applications: the dollar volume for HUD 232 loan applications has risen to about $4 billion, up from $800 million in 2007.
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