Appendix 2 Quality Control Plans and Identity of Interest
A.12.3.2 Basic Requirements for Insured Advances
HUD Multifamily Accelerated Processing (MAP) Guide, HUD Handbook 4430.G (2020 ed., rev. Mar. 19, 2021) · 2026 edition · updated 2026-10-05 · United States
A. The MAP Lender must have agreed to the necessary provisions at initial closing. See Chapter 12, Section 12.5 and Section 12.7.
B. The Construction Contract must include the rider “Amendment to the Construction Contract for Components Stored Offsite.” See Forms Appendix 12, Section A.12.4.
C. Payments are limited to the invoice value of the components.
D. The contractor and its surety bear full responsibility for fraudulent claims for payment and fraudulent disposition of such payments. Safeguards are to protect against premature payments, against materials that do not meet contract requirements, and against losses not covered by insurance.
E. The construction contract must be secured by a 100 percent performance and payment bond or a cash deposit or Letter of Credit in the amount of 15% or 25% of the HUD estimated cost of construction or rehabilitation for projects with four stories or less or five stories or more, respectively .
F. Components must be stored at a location approved by the Lender and HUD.
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