A.3.1.1 New — HUD Multifamily Accelerated Processing (MAP)

New Construction/Substantial Rehabilitation

A.3.1.1 New Construction/Substantial Rehabilitation
New Construction/Substantial Rehabilitation
Section of Act (SOA)	220	221(d)(4)	231	241(a)
Minimum # of Units	5	5	8	5
Criterion 3 (maximum % of cost except as noted)	90% - Projects with 90% or greater rental assistance. 87% - Projects meeting the Affordable Housing definition and for which the achievable tax credit rents are at least 10% below market. 85% - Market rate projects or tax credit projects without a significant rent advantage (i.e., achievable rents are at least 10% below market.)		Same as Section 221(d)(4) except for Substantial Rehabilitations, which will be controlled by the applicable percentage of “as rehabilitated” value.	90% of the HUD- estimated value of the improvements, additions or equipment. The cost of the repairs and transaction costs will be recognized as the value, so long as any additional land purchased or contributed is no more than the fair market value (FMV).
Criterion 4 (Statutory Limit on loan amount per unit)	Where percentages are required, enter the same percentage applied under Criterion 3. See Chapter 8 for complete details and the MF Housing website: http://portal.hud.gov/hudportal/HUD?src=/program_off ices/housing/mfh/hicost/hicoston information for per family unit limits and the high cost percentage (HCP) by jurisdiction.			The Supplemental Loan, when added to the outstanding balance of the mortgage covering the project or facility, may not exceed the maximum Statutory Limit Applicable to the building and unit type for the Section of Act (SOA) under which the existing first mortgage is insured.
Criterion 5 (maximum % of NOI allowed for debt service incl MIP)	90% (1.11 DSCR) –Projects with 90% or greater rental assistance. 87% (1.15 DSCR) –Projects that meet the Affordable Housing definition and for which the achievable tax credit rents are at least 10% belowmarket.			90% (1.11 DSCR) for combined debt service.

MAP Guide, March 2021 Go to beginning of Appendix 3

Bookmarked Version

Appendix 3 Page A3-1

Go to Acronym and Abbreviation List, Glossary, Index

To return to this page after clicking a link, press ALT + Back Arrow

Appendix 3 Program Specifications and Limitations A.3.1 Specifications and Limitations by Program

Go to Table of Contents

	New Construction/Substantial Rehabilitation
Section of Act (SOA)	220	221(d)(4)	231	241(a)
	85% (1.176 DSCR) –Market rate projects or tax credit projects without a significant rent advantage (i.e., achievable rents are at least 10% below market.)
Minimum Vacancy and Collection Loss Rates	3% - Projects with Housing Assistance Payments (HAP) contracts covering 90% or more of the units. 5% - Properties meeting at least the minimum LIHTC set aside requirements with or without income averaging, (20% of the units set aside for tenants earning not more than 50% of area median income; 40% of the units set aside for tenants earning no more than 60% of area median income), and attainable tax credit rents at least 10% below market. 7% - LIHTC properties with any percentage of units set aside but without a 10% discount to market; or market rate properties.
Occupancy Restrictions	Section 231 insured mortgages are restricted to elderly person (aged 62 or older) and/or persons with disabilities. SeeChapter 3, Section 3.5for definition of disabled persons. Age Restricted Projects Not Eligible for Section 220.
Underwritten Commercial Physical Occupancy	The lesser of 80% or that is indicated by market.			N/A
Commercial Space Limit	25%	25%	25%	25%
Commercial Income Limit (% of effective Gross Income)	30%	15%	15%	15%
BSPRA/SPRA Allowances	⚫ Available for Section 220, 221 and 231 for profit motivated Borrowers and limited distributions Borrowers ⚫ For Section 231, allowed on New Construction if no Developer fee; n/a for Section 231 Substantial Rehabilitation Deals.			BSPRA/SPRA is not available.
HUD Application Fee	⚫ $3.00 per $1,000 of required mortgage amount. For market rate projects, one half of the application fee is due at pre-application and the other half is due with the application for Firm Commitment. ⚫ For affordable projects the entire amount is paid at the Firm Commitment stage, regardless of whether or not a Pre-Application is filed with HUD. Refer to Chapter 3, Section 3.1.36.for Application fees for Opportunity Zone projects.

MAP Guide, March 2021 Go to beginning of Appendix 3

Bookmarked Version

Appendix 3 Page A3-2

Go to Acronym and Abbreviation List, Glossary, Index

To return to this page after clicking a link, press ALT + Back Arrow

Appendix 3 Program Specifications and Limitations A.3.1 Specifications and Limitations by Program

Go to Table of Contents

	New Construction/Substantial Rehabilitation
Section of Act (SOA)	220	221(d)(4)	231	241(a)
HUD Inspection Fee	$5 per thousand of the mortgage amount for new construction and $5 per thousand of the total of all improvement costs for substantial rehabilitation. The inspection fee is no longer calculated on BSPRA and SPRA.
Maximum Lender Fees and Charges	3.5% of the mortgage amount, (this calculation may consist of any combination of origination, financing, and permanent placement fees as long as it also includes the Lender’s legal fee). Financing and placement fees up to 5.5% are permissible in bond transactions. Third party costs (e.g., appraisal, market study, capital needs assessment, and other organization costs) may be included as mortgageable soft costs in the mortgage calculations and are not included in the limitation on Lender fees.