Federal Housing Administration (FHA) Approved
Direct Lending Programs

As the State’s affordable housing finance agency, IHDA is the only Federal Housing Administration’s (FHA) lender in Illinois that has been approved by the US Department of Housing and Urban Development (HUD) to initiate loans for the acquisition, construction, substantial rehabilitation or refinancing of affordable rental developments under the following FHA programs:

• Risk Share program
• FHA LEAN program
• Multifamily Accelerated Processing (MAP) program

The Risk Share Program

This program targets lending opportunities for most property types including assisted living, elderly and family developments.

The FHA LEAN Program

This program targets lending opportunities for supportive living facilities (or assisted living facilities). IHDA submits and processes applications for the following FHA multifamily insurance programs using LEAN:

• Section 207 insures mortgage loans to facilitate the purchase or refinancing of existing multifamily rental housing. These projects may have been financed originally with conventional or FHA insured mortgages.
• Section 232 insures mortgage loans to facilitate the construction and substantial rehabilitation of nursing homes, intermediate care facilities, board and care homes, and assisted-living facilities. Section 232/223(f) allows for the purchase or refinancing with or without repairs of existing projects not requiring substantial rehabilitation.

The Multifamily Accelerated Processing (MAP) Program

This program targets lending opportunities for affordable rental apartments (excluding assisted living facilities). IHDA submits and processes applications for the following FHA multifamily insurance programs using MAP:

• Section 207 insures mortgage loans to finance the construction or rehabilitation of a broad range of rental housing and to facilitate the construction or substantial rehabilitation of multifamily manufactured home parks. Section 207 mortgage insurance, although still authorized, is no longer used for new construction and substantial rehabilitation. It is however, the primary insurance vehicle for the Section 223(f) refinancing program. Multifamily new construction and substantial rehabilitation projects are currently insured under the Section 221(d)(3) and Section 221(d)(4) programs.
• Section 221(d)(4) insures mortgage loans to facilitate the new construction or substantial rehabilitation of multifamily rental or cooperative housing for moderate-income families, seniors, and people with disabilities. Single Room Occupancy (SRO) projects may also be insured under this section.  There are no federal rental subsidies involved with this SRO program.  Although SRO housing is intended for very low-income persons, the program does not impose income limits for admission.
• Section 223(f) insures mortgage loans to facilitate the purchase or refinancing of existing multifamily rental housing. These projects may have been financed originally with conventional or FHA insured mortgages. Properties requiring substantial rehabilitation are not eligible for mortgage insurance under this program. HUD permits the completion of non-critical repairs after endorsement for mortgage insurance.

For more information on any of the above programs, please contact Steve Gladden, IHDA’s Assistant Director of Multifamily Financing at 312-836-5200.