Recently, HUD issued policy change H 04-21 to Section 202 Housing Code.

Currently, HUD 202 properties receive monthly Section 8 subsidies, and return a large portion of that subsidy back to HUD through debt service on the current HUD 202 loan. Refinancing with Trust Mortgage with a HUD insured mortgage (with a private lender) can result in significant savings which are reinvested into the property, rather than.

The Goal

Many 202s were financed at high rates. Refinancing at today’s lower rates, while they last, with a new 35 year HUD insured mortgage, accomplishes two main objectives that most all non profit boards are interested in:

1) Put money back into the property for no increased cost:

A typical original loan amount of $2,500,000 financed at 9% that is 20 years old would result in an increased mortgage proceeds of $1,490,000 that could be used for improvements, an increase in reserves or both. By keeping the current debt service the same!

2) Tie the property to HUD for an additional 35 years:
There is always talk about HUD reforming the Section 8 program and trying to eliminate it. By refinancing with a HUD insured loan for an additional 35 years helps preserve the HAP contract and the Section 8 rents subsidies.


fffThe professionals at Trust Mortgage Company bring several decades of non-profit and low-income finance experience to each transaction. We are comprised of a team with the breadth of experience to ensure your transaction closes as quickly and painlessly as possible.

This experience includes:

1) HUD lobbying group member helping to formulate housing policy for HUD.

2) Asset and Property Manager for thousands of units of elderly housing in several states

3) Underwriting and closing some of the first 202/223(f) Refinance Transactions in the nation.

4) Low Income Housing Tax Credit experience beginning with the inception of the

5) Property management experience with all forms of low income and elderly housing comprising over 60,000 units in several states including luxury condos, office and retail.


Due to this varied and nuanced experience, TMC is able to maximize your refinance benefits while minimizing your time, allowing your group to focus on providing your core services.

The principals of Trust Mortgage Company, Inc. are one of the few lenders to actually have developed, managed and financed subsidized and senior housing with closed loans from Alaska to Florida.


Stage I: Processing

Processing Fee:

Refunded at closing $12,500

Phase I Environmental Report (est.): $2,500

Appraisal (est.): $5,000 to $9,000

Property Condition Assessment (PCA) Report (est.) $4,000

Exam Fee to HUD with final application: 3/10 of1% of Mtg Amount

Provided all borrower requested information is received in a timely manner, TMC estimates 60 days to prepare the Firm Submission for submittal to HUD and a 60 day review period for HUD. Total Time frame is 120 days. Successful conclusion of’ processing, results in a Firm Commitment to set up the sale of the GNMA securities and closing within a few weeks.

Stage II: Closing

Good Faith Deposit (locks the rate and is paid at commitment)1/2 of 1% of mortgage (50 bps). Credited to fees at closing. THIS MAYBE WAIVED FOR EXISTING 202′ S. HUD requires a minimum of 15 days to review closing documents. Typical closing times are within 30 days of rate-lock. This may be expedited with waivers from HUD, efficient reviews, etc. The above time line indicates 5 months for a closing with HUD. This time frame may be shortened to the extent that third parties (appraiser, engineer) can expedite their engagements.


Please contact us now to insure the long term viability of your property