[Logo: Homes and Communities: U.S. Department of Housing and Urban Development]
[Vea la versi�n en espa�ol de esta p�gina] [Contact Us] [Display the text version of this page] [Search/Index]
 
U.S. Department of Housing and Urban Development

Housing
About Housing
Contact us
Keywords
Single Family
ORMRA
Hospitals
 - Multifamily
 - - About MF business
 - - Multifamily data
 - - Program information
 - - Renting
 - - Sec 8 expiring contracts
 - - Sec 8 contract admin
 - - MF Accel Processing (MAP)
 - - Neighborhood Networks
OAHP
Reading room
Online forums
Work online

HUD news

Homes

Resources

Communities

Working with HUD
Webcasts
Mailing lists
RSS Feeds

[The U.S. government's official web portal]  

Risk-sharing Program - Qualified Participating Entities (QPE): Section 542(b)

- -
 Information by State
 Print version
 
-
Want More Information?
-

Program instructions are in HUD Handbooks, Notices and Forms which can be found on HUDclips.

Prospective applicants should contact the local HUD Multifamily Hub or Program Center with jurisdiction for the property.


Summary:
The Department of Housing and Urban Development (HUD) provides reinsurance on multifamily housing projects whose mortgage loans are originated, underwritten, serviced, and disposed of by Qualified Participating Entities (QPEs) and/or their approved lenders. Section 542(b) encourages the development and preservation of affordable housing. The program was developed as a demonstration program to test innovative mortgage insurance and reinsurance products to provide affordable multifamily housing through a partnership between the QPEs and HUD. HUD's mortgage credit enhancements are used to support the underwriting and production strengths of Fannie Mae, Freddie Mac, and other qualified Federal, State, and local public financial and housing institutions.

A related program is the Housing Finance Agency Risk-Sharing Program (Section 542(c)).

Purpose:
The program provides a new insurance authority independent of the National Housing Act. The purpose of the program is to support and encourage the production and preservation of affordable Housing. The program provides insurance and reinsurance for multifamily housing projects whose loans are originated, underwritten, serviced, and disposed of by a QPE and/or its approved lenders.

Type of Assistance:
Guaranteed/Insured Loans. A QPE and/or its approved lenders may originate and underwrite affordable housing loans. If there is a default, the QPE will pay all costs associated with loan disposition and will seek reimbursement from HUD. The HUD risk share will be 50 percent pro rata. The program enables HUD to provide alternative forms of Federal credit enhancement to increase affordable multifamily housing lending.

Eligible Activities:
HUD selectively invites QPEs to participate in a variety of mortgage options to assess the effectiveness of the various credit enhancements. The QPE and HUD enter into Risk-Sharing agreements to implement the program. A QPE or its lender, in turn, makes loans to investors, builders, developers, public entities, and private nonprofit corporations or associations.

Eligible Borrowers:
Eligible mortgagors include investors, builders, developers, public entities, and private non-profit corporations or associations may apply to a qualified QPE and/or its lender.

Eligible Customers:
Individuals, families, and property owners are eligible.

Application:
To obtain mortgage insurance, a potential lender should consult with a HUD-approved QPE to obtain mortgage insurance. The potential lender then submits an application directly to the QPE. If the QPE refuses the application, the applicant may modify the application and reapply. While QPEs are vested with a large amount of responsibility for projects, HUD has the authority to adjust the mortgage amount and endorse the note.

Technical Guidance:
The program is authorized by the Housing and Community Development Act of 1992, Section 542(b), Public Law 102-550, 12 U.S.C. 1707. There are no program regulations; requirements are set forth in risk-sharing agreements with the QPEs. Section 235 of HUD's FY 2001 Appropriations Act, Public Law 106-377, amended Section 542, which changed the Risk Sharing Pilot Program to a permanent multifamily insurance program. The program is administered by the Office of Multifamily Housing Development.

Program Accomplishments:
In fiscal year 2013, the Department insured mortgages for 40 projects with 4929 units, totaling $315 million.

 
Content current as of 17 December 2012   Follow this link to go  Back to Top   
----------
FOIA Privacy Web Policies and Important Links  Home [logo: Fair Housing and Equal Opportunity]
[Logo: HUD seal] U.S. Department of Housing and Urban Development
451 7th Street S.W., Washington, DC 20410
Telephone: (202) 708-1112   TTY: (202) 708-1455
Find the address of a HUD office near you