NAA/NMHC and a coalition of real estate organizations have submitted comments to HUD/FHA on proposed changes to the FHA multifamily loan closing documents. The comments cite serious concerns with HUD’s proposal to retain some limited recourse liability for principles that commit certain “bad boy acts.” NAA/NMHC also oppose a proposed expansion in the definition of project funds that fails to recognize the distinction between project funds properly under control of HUD and other funds that may be in the possession of the borrower. Finally, NAA/NMHC express concerns over the timing of implementing the changes and language that implies the ability of HUD to impose additional future obligations on borrowers.
The letter is available here. HUD’s proposed changes are at http://bit.ly/912Cnr.