lis 217 stemming the tide - LISC

PROFORMA 4: NONPROFIT PURCHASE WITH MARK-TO-MARKET DEBT RESTRUCTURINGUnits Current Underwriting Basis Rent Total Per UnitRent Rent IncreaseIncome/ExpensesSection 8 Units 100 $750 $600 Market -20% $720,000Vacancy & Bad Debt 7% (50,400)Effective Gross Inc. 669,600Operating Expenses Rate Term (years) Constant 500,000 5,000Capital Recovery Pmt 9% 10 0.15201 16,721Net Operating Income 152,879Debt Service 127,399Cash Flow 25,480Debt Coverage 1.20Distribution of Cash Flow:Incentive Perf. Fee 3.0%EGI (up to 3%; $100 - $200 / unit) 20,000Debt Serv. - 2nd Mtge (forgiven) 0Share to Buyer 5,480Total Cash Flow 25,480Cash Available to Buyer:Capital Recovery Payment (CRP) 16,721Incentive Performance Fee (IPF) 20,000Cash Flow Share 5,480Total Cash Flow to Buyer 42,201Sources of Funds* Rate Term (yrs) MIP ** ConstantNew HUD Mortgage 8.25% 25 0.5% 0.09961 1,278,928 12,789Existing Reserve Balance 100,000 1,000Owner Contribution 20% rehab + transaction costs 110,000 1,100HUD 2nd Mortgage FORGIVEN 521,072 5,211HUD 3rd Mortgage FORGIVEN 616,500 6,165Total Sources 2,626,500 26,265Uses of Funds*Repay Existing HUD Mortgage 1,800,000 18,000Rehab + Contingency 500,000 5,000Initial Reserve Deposit 200,000 2,000Transaction Costs 50,000 500Developer Fee 2.9%x uses (up to 3%; $40,000 - $80,000) 76,500 765Total Uses 2,626,500 26,265HUD Contribution:HUD Share:Reduction in 1st Mortgage 521,072 5,211Repairs 80% 400,000 4,000Transaction Costs 80% 40,000 400Initial Reserve Deposit 100% 200,000 2,000Developer Fee 100% 76,500 765Less: Existing Reserve Balance (100,000) (1,000)Total 1,137,572 11,3762nd Mtge 3rd MtgeRestructuring Pmt. 521,072 616,500 1,137,572 11,376* Not including additional buyer costs (acquisition, rehab, transaction) which must be paid from other sources.** Mortgage Insurance Premium20 chapter two: Federal Preservation Tools