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What Has Sims Mortgage Funding Been Up To?

Over the past few months, the SMF team has racked up thousands of frequent flier miles and hundreds of hotel points traveling to the lender’s conferences and HUD training sessions. It’s a great opportunity to network with senior HUD officials, obtain first-hand updates on policies and programs, and commiserate, sometimes over adult beverages, with our colleagues in the industry about life dealing with HUD!

  • In February, Kerrie Tomasiewicz and Andrew Patykula attended the Eastern Lenders Association annual meeting in Baltimore, MD. The ELA is a group of lenders and consultants active in HUD’s Northeast Region, which extends from Maine to Virginia. We’ve closed almost $1.2 billion in HUD-insured loans in the Northeast Region, most recently for two affordable housing projects in Maryland and New Jersey.
  • Kerrie was on the road again in May, this time with Anthony Luzzi, attending the Southwest Mortgagee Advisory Council annual meeting in Fort Worth, TX. SMF has closed $460 million in loans in the Southwest Region, primarily for new construction of market-rate housing and affordable housing preservation.
  • In early June, Andrew Patykula represented SMF at the LEAN Lender Dialogue and Underwriter Training in Seattle, WA. This interactive meeting provided a frank two-way exchange of ideas on how to make HUD’s healthcare mortgage insurance programs work better, and is emblematic of the LEAN program’s goal of continuous improvement.
  • In mid-June, Anthony participated in HUD’s Section 242 Hospital Training program in Washington, DC. SMF has recently increased its presence in the Section 242 mortgage insurance program – in March, we closed a $30 million loan for Parkview Community Hospital in Riverside, CA and are currently developing a $95 million application for a major expansion project for the Baton Rouge General Medical Center in Louisiana.

Here are four take-aways from the SMF team’s recent travels.

  • With the creation of the Western Region, the makeover of HUD’s multifamily lending platform is complete. HUD now has five fully functioning regional offices and seven “satellite” offices handling multifamily mortgage insurance applications, which are fully standardized as to form and content, and are reviewed by a single underwriter.
  • Processing timeframes for multifamily deals have been consistently improving: preliminary applications at 45 days, firm commitment applications from 45 to 60 days, and streamlined refinance applications at 30 days. We recently obtained two such multifamily approvals in 16 and 32 days!
  • Prevailing wage (“Davis – Bacon”) decisions continue to pose challenges for new construction loans, as they are increasing costs at a time when developers are seeing an overall escalation in project budgets. Higher labor rates largely stem from outdated surveys of wage data and the issuance of multiple decisions for a single project. The Department of Labor, not HUD, is the source of these challenges – the involvement of our elected officials will most likely be needed to resolve matters.
  • The new LEAN guidelines make it easier to refinance existing debt that included an equity take-out, in some cases eliminating the prior 2-year seasoning requirement. However, to take advantage of this opportunity, there must be close cooperation and communication between the bridge and HUD lenders. SMF has the expertise to coordinate this process, as we have closed over $190 million in HUD-insured loans that have refinanced bridge and REIT debt.