HUD 232 LEAN Loans

HOW HUD 232 and HUD 232/223(f) Loans Are processed 

HUD 232 and HUD 232/223(f) loans are some of the best options in the industry for financing the construction, acquisition, refinancing, and substantial rehabilitation of healthcare properties, including senior living, assisted living, and skilled nursing facilities. While these loans used to be processed using TAP (traditional application processing), or MAP (multifamily accelerated processing), beginning in 2008, HUD began transitioning to using LEAN processing, a newer, more streamlined form of loan processing. With LEAN processing, some HUD 232 loans can take as little as 4 months to close. 

At Commercial Real Estate Loans, Inc., we know how important it is that developers create safe, healthy, and cost-effective housing for America's growing population of senior citizens. That's why we're excited to support investors and developers through each stage of the LEAN process for HUD 232 and HUD 232/223(f) loans-- answering questions, developing solutions, and helping in any way we can. 


HUD 232 LEAN LOAN PROCESSING

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 HUD 232 LEAN processing has instituted a variety of changes to the HUD loan process, including: 

  • Standardized forms, including lender templates, third-party work forms, and certifications
  • Less duplicate forms required (i.e. closing documents do not have to be submitted twice) 
  • Propriety earnings carve-outs are not required 
  • Borrowers do not submit LEAN applications directly; instead, lenders submit these applications directly to the OCRF (HUD's Office of Residential Care Facilities) 

HUD 232 LEAN Requirements 

HUD 232 LEAN processing also has a variety of specific application requirements, including: 

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  • Physical Property Exam: HUD requires that a third-party expert examine the property, determining a specific amount of replacement reserves that it will require. If significant work on the property is required, it may require a HUD 232 loan for substantial rehabilitation. 
  • Credit/Financial Check/Experience: HUD will examine a developer's credit history, financial health, and will look into any experience they have-- including any other facilities they own/operate (or have owned/operated). 
  • Formal Incident Reports:  A formal, software-based incident reporting system is required for all properties using HUD 232 loans. 
  • Special Portfolio Reviews:  If a borrower has three or more properties with the same ownership, HUD may order an additional review and may also require a master lease. 

Commercial Real Estate Loans, Inc. is the partner you need to help acquire, build, refinance, or repair your next multifamily or commercial real estate project. Whether you're a small startup or an established company, we have the knowledge and experience to give you more financing options!