A.3.8.2 Broadly Affordable Housing

A. Annual MIP is 25 basis points for all multifamily FHA-insured loan types that meet the criteria in this section.

• B. These projects must either:

1. Have at least 90 percent of units covered by a Section 8 Project Based Rental Assistance (PBRA) contract or other federal rental assistance program contract serving very low-income residents, with a remaining term of at least 15 years; or

2. Have at least 90 percent of units covered by an affordability use restriction under the Low Income Housing Tax Credit (LIHTC) program or similar state or locally sponsored program, with achievable and underwritten tax credit rents at least 10 percent below comparable market rents, and with a recorded regulatory agreement in effect for at least 15 years after final endorsement and monitored by a public entity.

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Appendix 3 Program Specifications and Limitations A.3.8 Affordable & Green MIP Rate Categories

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C. To ensure that the benefits of these MIP rates directly benefit the affordable housing properties and residents, Lenders submitting applications for loans using this MIP rate are limited in the total loan fees they may charge on any loan greater than $2 million, to no more than 5 percent of the insured loan amount. Loan fees include: (a) origination and placement fees as permitted by this MAP Guide; plus (b) trade profit, trade premium, or marketing gain earned on the sale of the Government National Mortgage Association (GNMA) security at a value above par, even if the security sale is delayed until after endorsement, minus (c) loan fees applied by the Mortgagee to its legal expenses incurred in connection with loan closing. However, Section 223(a)(7) applications are exempt from the Lender fee limitation to the extent that trade premium is used to offset prepayment penalties on the existing insured loan.

D. Owners of properties that fall under the category of Broadly Affordable with voucher holding residents must continue to accept vouchers. There is no requirement to sign a rider in this instance.

E. For Section 220, 221(d)(4) or 223(f) loans, the appraisal should evidence the market rents and confirm the achievable Tax Credit results used in underwriting are at least 10% below comparable rents.

F. For a Section 223(a)(7) LIHTC refinance where there is no project-based Section 8 rental assistance, a Rent Comparability Study is required including a form HUD-92273-S8 completed by an appraiser retained as a third-party professional by the Lender. If the project is both LIHTC and Section 8 rental assisted, then the requirements of the HAP contract or its renewal or amendment govern whether a Rent Comparability Study is required.