Federal Housing Agency (FHA)

Last week the Department of the Treasury and HUD sent their Housing Finance Reform Plans to President Trump following his March Memorandum, which ordered the reports. The Senate Committee on Banking, Housing and Urban Affairs held a hearing on Housing Finance Reform: Next Steps with HUD Secretary Ben Carson, Treasury Secretary Steven Mnuchin and FHFA Director Mark Calabria as witnesses.

HUD announced that the Federal Housing Administration (FHA) will insure mortgages on mixed-use development in opportunity zones under the agency’s Section 220 program. Historically, Section 220 has provided mortgage insurance for rental housing in downtown urban areas that have been targeted for overall revitalization. Now, all 8,764 Opportunity Zones, including those located in rural area, […]

HUD posted new closing checklists for use with the recently revised FHA closing documents. The new checklists include non-substantive changes to the layout, re-ordering of certain items, removal of items that have been added to other form documents, and a new checklist for the “Heavy” 223(f) closings.

HUD’s Housing Notice 2019-07 provides incentives for multi-family property owners to invest in Opportunity Zones across the nation. Applicants to FHA’s Section 221(d)(4), Section 220 and Section 223(f) will be eligible for significantly lower application fees provided the property is located within an Opportunity Zone.

HUD now expects to release the RAD revised notice (RADRev4) with modest changes to the public housing component and thorough instructions for the new RAD-for-PRAC authority in early to mid-June 2019. While waiting for RADRev4 there is plenty PHAs and their partners can do now to take advantage of recent flexibilities with RAD and other HUD preservation-redevelopment tools. 

HUD released the 2019 Mortgage Limits for Multifamily Housing Programs. The notice also updates the per unit limit for substantial rehabilitation from $15,000 to $15,933.

HUD announced the expansion a Federal Housing Administration (FHA) pilot program that streamlines FHA mortgage insurance applications for affordable housing developments that have equity from the sale of LIHTC Program to also include Section 221(d)(4) and Section 220 loan products.

RED Mortgage Capital, a division of ORIX Real Estate Capital, LLC, has hired Sean Cullen and Ronnie Gyani to lead its multifamily affordable lending activities in the greater New York City area. Cullen and Gyani have worked together since 2010 and both bring a strong level of affordable housing finance experience to RED’s New York and East Coast operations.

The Government Accountability Office (GAO) issued a new report Housing Finance: Prolonged Conservatorships of Fannie Mae and Freddie Mac Prompt Need for Reform. The report, prepared for Chairwoman of the House Committee on Financial Services Maxine Waters (D-CA) and Congressman Sean Duffy (R-WI), calls on Congress to “consider legislation for the future federal role in housing finance that addresses the structure of the enterprises, establishes clear, specific, and prioritized goals and considers all relevant federal entities, such as FHA and Ginnie Mae.”

HUD’s office of multifamily housing issued two memos regarding its operation during the partial government shutdown. The first memo details Federal Housing Administration (FHA) mortgage insurance applications and production activities and the second memo details multifamily asset management activities.

The Federal Financing Bank (FFB) multifamily risk-sharing initiative with Housing Finance Agencies (HFAs) officially ended on Dec. 31, 2019. In February of 2018, HUD announced that it would end the FFB financing initiative on Sept. 30, 2018. In September of 2018, HUD then granted an extension through the end of the year to review the program’s effectiveness.

HUD recently issued Notice 2018-10 that details best practices to help ensure guest suite use is consistent with National Housing Act prohibitions against transient or hotel use of multifamily properties. HUD acknowledges guest suites as an amenity may contribute to the marketability of certain multifamily projects.