Reduced Occupancy Affordable Rehab (ROAR) Execution
- Flexible permanent loan solution that allows the sponsor to rehabilitate more efficiently.
- Eliminates need for a construction loan or forward commitment.
- Increased leverage opportunities when underwritten to as-improved rents.
- Interest only during rehab period.
- Existing, stabilized Multifamily Affordable Housing properties undergoing renovations.
- Borrowers and Lenders with demonstrated experience.
- Available for both acquisition and refinance.
5 - 30 years.
Up to 35 years.
Fixed- and variable-rate options. Variable-rate only available for a Credit Enhancement Mortgage Loan for a bond transaction.
Up to 90% “as stabilized.”
1.15x – 1.20x “as stabilized.”
Cash or Credit Enhancement Mortgage Loan for a bond transaction. Interest only available, structured to match the rehab period.
$5,000,000 minimum. No maximum.
Stabilized Multifamily Affordable Housing properties undergoing renovations up to $120,000 per unit.
Strong borrowers with demonstrated tenant-in-place rehab track record.
30- to 180-day commitments.
Flexible prepayment options available, including yield maintenance and declining prepayment premium.
12 – 15 months.
REHAB PERIOD OCCUPANCY
During the rehabilitation period occupancy may drop from stabilized levels to a minimum of 50%.
REHAB PERIOD DSCR
During the rehabilitation period, DSCR may drop from stabilized levels to a minimum of:
- 1.0x (Interest-only basis)
- 0.75x (Amortizing basis)
Rehab funds escrowed by Lender.
Fully stabilized no later than 15 months after loan origination.
FANNIE MAE UW FEE
Non-recourse execution with standard carve-outs for “bad acts” such as fraud and bankruptcy. Construction Completion and Operating Deficit Guarantees required during the rehab and stabilization period.
This sheet sets out the general guidelines of a loan program and is designed solely as an aid to prospective borrowers and other clients. It does not represent or imply a contract or a commitment to lend funds. A commitment to lend funds may only be made by a written letter issued by NewPoint to a prospective borrower. This term sheet is subject to change at any time without notice at the sole discretion of NewPoint Real Estate Capital LLC.