The Federal Housing Administration (FHA) issued a memorandum on March 4 to multifamily underwriters in its field offices nationwide that should make it easier to finance Low-Income Housing Tax Credit (LIHTC) properties under an FHA pilot program.
FHA’s memo outlines the waivers necessary to modify the underwriting requirements for LIHTC financed transactions, including the types of debt that will be allowed to be considered, but not counted against, the maximum loan amount (i.e. grants, cash-flow loans, subordinated debt, etc.); application of the three-year waiver rule for newly constructed properties; loans where the lender and borrower share an identity interest; and repair escrow timing and funding.
In addition to the waivers, the memo clarifies application of several underwriting issues that are currently required based on processes outlined in the Multifamily Accelerated Processing (MAP) Guidebook, which is used by MAP-approved lenders and by HUD’s Multifamily Offices.
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