Loan follows Golden Rule.Deutsche Bank Berkshire Mortgage (DBBM) recently provided a $12.6 million Federal Housing Administration Federal Housing Administration (FHA) Federally sponsored agency chartered in 1934 whose stock is currently owned by savings institutions across the United States. The agency buys residential mortgages that meet certain requirements, sells these mortgages in packages, and insures (FHA See Federal Housing Administration. FHA See Federal Housing Administration (FHA). )-insured loan for the acquisition and rehabilitation of Golden Rule Apartments, a 183-unit, ten-story building in Washington, DC. Financing was done under HUD's Section 221(d)(4) Mortgage Insurance Program, which provides integrated construction and permanent financing Permanent financing Long-term financing using either debt or equity. permanent financing The long-term financing that supports a long-term asset. . Tax exempt bonds issued by the D.C. Housing Finance Authority funded the loan and equity was raised through the sale of low income housing tax credits. Subordinate debt was provided by the D.C. Department of Housing and Community Development. The structure of the loan included an IRP See Interest rate parity line. decoupling Decoupling The occurrence of returns on asset classes diverging from their normal pattern of correlation. Notes: Take for example stock and corporate bond returns, which normally rise and fall together. , which allowed the pre-existing monthly interest reduction payment (IRP) subsidy to continue after payoff of the current loan. These funds were used as an additional source of income to support a portion of the new debt on the property. The property carries a project-based Section 8 contract that provides rent subsidies to 100% of the tenants. |
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