The U.S. Department of Housing and Urban Development (HUD) has selected a contractor to help address the backlog of applications for Section 232 loans, which provides capital access to companies developing or modernizing senior living communities.
The U.S. Department of Housing and Urban Development (HUD) has awarded a one-year contract to Summit Consulting, LLC to support Section 232 underwriting efforts within the Office of Healthcare Programs (OHP.) Summit will perform the analytical due diligence required by OHP’s standardized underwriting process for Section 232 applications. Completed forms and due diligence materials will be evaluated by designated OHP Relations Managers (serving as Government Technical Monitors) for approval before submission to OHP’s Loan Committee. The contractor will work to reduce the pending applications down to a 30-day backlog.
Before beginning work, Summit contractors must successfully complete an OHP training course, which begins next week. FHA’s ultimate goal is to reduce the number of Section 232 loan applications, perhaps by as many as 400 within the next six to nine months. The backlog will also be addressed by an additional 24 new employees hired by HUD specifically to address Section 232 applications.
In another positive development, HUD closed 62 Section 232 loans in June, a record for the program. This has resulted in eliminating the closing queue for 232 program loans.
The Section 232 Program provides capital access for assisted living communities, nursing homes, and other residential long term care settings through mortgage insurance and better loan terms and dramatically reduced interest rates when borrowing money to build, replace, or modernize communities. Communities that are financed through this program are able to offer affordable care settings that often serve citizens who receive funding through Medicaid or other publicly financed program.
ALFA has worked closely with HUD officials, members of Congress, the mortgage insurance and senior care industries to obtain the additional staffing so that the Section 232 Program is a viable option for operators who provide affordable senior living.
