W I T N E S — HUD Multifamily Accelerated Processing (MAP)

WHEREAS , the Lender has made a mortgage loan to the Borrower in the original principal amount of $________________ (hereinafter called the “Loan”), which Loan is insured by the Secretary of Housing and Urban Development acting by and through the Federal Housing Commissioner (“HUD”) for the purpose of refinancing and renovation or financing the acquisition and/or rehabilitation or renovation of a multifamily housing rental apartment project known as “ _______________ ” and located at ___________________________ (the “Project”) in the city and state of ________________________________; and

WHEREAS , on ____, HUD issued a certain Commitment for Insurance or Commitment for Insurance of Advances (as amended, the “FHA Commitment”) to insure the Loan under Section _______ of the National Housing Act, as amended, pursuant to which FHA Commitment the Borrower is required to provide from either its own funds and/or from loan proceeds a deposit with the Lender in the amount of $ to meet the cost of providing relocation services and other appropriate activities for tenants of the Project (the “Relocation Deposit”) in accordance with the Relocation Plan attached as Exhibit “A” hereto and made a part hereof (the “Relocation Plan”); and

WHEREAS , the Borrower has executed and delivered to the Lender a certain HUD Multistate Note (the “Note”) in the principal amount of the Loan, a Multifamily Deed of Trust, Assignment of Leases and Rents and Security Agreement (the “Mortgage”) securing the Note, a Regulatory Agreement, and certain other agreements, documents and certificates (which Note, Mortgage, Regulatory Agreement, agreements,

MAP Guide, March 2021 Go to beginning of Appendix 3

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Appendix 3 Program Specifications and Limitations A.3.6 Tenant Relocation Escrow Agreement (guide form)

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documents and certificates are hereinafter collectively called the “FHA Loan Documents”) in connection with the Initial/Final Endorsement by HUD of the Note; and

WHEREAS , in order to induce the Lender to advance proceeds of the Loan and HUD to insure the Loan, the Borrower provided said Relocation Deposit and Relocation Plan.

NOW, THEREFORE, in consideration of the foregoing, the terms, covenants and conditions set forth herein, and other good and valuable considerations, the receipt and sufficiency of which is hereby mutually acknowledged, the parties agree as follows:

In order to establish the Relocation Deposit, the Borrower has furnished or caused to be furnished to the Lender cash in the amount of $______________ (the “Escrow Fund"), the receipt of which is hereby acknowledged by the Lender. The Escrow Fund shall be held by the Lender for application or release as hereinafter set forth.
The Escrow Fund shall be held by the Lender for a period beginning on the date hereof until the date of completion of construction at the Project (as such date of completion may be extended by the Lender or HUD, the “Escrow Period”). Upon the expiration of the Escrow Period, any balance remaining in the Escrow Fund may be allocated with HUD’s approval to meet other program financial requirements when funds available for such purposes have been exhausted. Thereafter any further balance remaining which was not funded from mortgage proceeds shall be returned to the Borrower and any additional remainder that was funded from mortgage proceeds shall be deposited into the Project’s replacement reserve account. If the Relocation Deposit consisted of both the Borrower’s funds and loan proceeds, then the Borrower’s funds shall be deemed as first used or disbursed.
Subject to the provisions of Paragraph 6 hereof, the Escrow Fund may be disbursed for meeting the cost of providing certain relocation costs and other appropriate programs to residents of the Project according to the Relocation Plan. In connection with any request by the Borrower for disbursement of the Escrow Fund, the Borrower shall provide such documentation and information as the Lender and HUD may require. Further, and to the extent the Lender deems it necessary, all disbursements shall be subject to receipt by the Lender of satisfactory documentation evidencing HUD’s approval.
Any portion of the Escrow Fund consisting of cash shall be maintained in one or more accounts insured or fully guaranteed as to principal by the United States of America, shall at all times be under the control of the Lender, and shall be held by the Lender in a manner that conforms to standards established by HUD.
This Agreement is entered into by the parties hereto for the benefit of the Lender (or any subsequent holder of the Note) and HUD, either of which shall have the right to act as Depository and/or enforce the provisions hereof.
The Escrow Fund shall be subject to immediate application to the mortgage debt in the event of a default under the Note or Mortgage at any time prior to the expiration of the Escrow Period; provided, however, that the Escrow Fund shall be subject to the control and direction of HUD in the event that the Lender submits a claim to HUD for the payment of insurance benefits.
In the event of any conflict or inconsistency between this Agreement and the FHA loan documents, rules, regulations, and administrative procedures, the FHA loan documents, rules, regulations, and administrative procedures shall govern and be controlling.
This Agreement shall be binding upon and shall inure to the benefit of the parties hereto and their respective successors and assigns.