Posted by PeteH(NYC) on March 26, 2000 at 15:00:56:
This is a program with some terrific benefits – 40-yr amortization, market rate, no recourse to the borrower – but that can be tricky to get lined up. Real world issue (no rules against, but…): since banks are limited to, I believe, 3% profit on this loan (HUD guarantees it, and therefore writes the rulebook), most lenders prefer not to look at any loan under $1 million.
There’s a guy in Florida named Ed Hicks who makes a living consulting on park development and brokering these loans; he also does two or three development seminars per year in conjunction with Indiana’s George Allen, a well-respected park owner & consultant. Hicks puts out a book specifically describing the 207(m); Allen wrote and co-wrote two bibles on the field, descriptions of which are available at his website, www.mfdhousing.com. I attended their development workshop in October, and they are genuine guys with a load of experience in the field.