2453.1-CA Firm Commitment for Capital Advance Financing Upon Proje

Capital Advance Mixed-Finance
Program

U.S. Department of Housing
and Urban Development
Office of Housing
Federal Housing
Commissioner

Firm Commitment for Capital Advance Financing
Upon Project Completion
(Section ___)
Project Number _____________

Project Name ________________________

To (Name of Mixed-Finance Owner)

Street Address

City & State

Zip Code

Your Request for Firm Commitment for Capital Advance Financing has
been reviewed pursuant to 24 CFR Part 891 and your final plans and
specifications and the Contractor/Owner's cost estimates have been
found to be acceptable. Our attachment of forms HUD-92264 and
92264-A (see Paragraph 11 below) evidences compliance with the
requirements of 24 CFR Part 891.
The Secretary of Housing and Urban Development (hereinafter
called “Secretary” and/or “HUD”) will make and disburse a capital
advance upon completion of the Project under the provisions of
Section 202 of the Housing Act of 1959, or Section 811 of the
National Affordable Housing Act (NAHA), and the Regulations now in
effect, pursuant to a mortgage note in the amount of $ ____________
to be secured by a mortgage or deed of trust on the property
located at ________________________________________________________
and consisting of approximately ______________________ square feet.
The project will consist of ____ Capital Advance-assisted units and
____ non-Capital Advance-assisted units.

Estimated project

development cost (based on the replacement cost minus grants/loans
Form HUD-2453.1-CA (9/2007)
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for replacement cost items, excess unusual land improvements, cost
of ineligible amenities, value of leased fee and unpaid special
assessments) is ______________________.

The capital advance will

be subject to compliance with the requirements of the Regulations,
the Mortgage Note, form HUD-93432-CA, the Mortgage Deed of Trust or
Security Deed, form HUD-90165-CA, Part I of Project Assistance
Contract, form HUD-90173-CA; Part II of Project Rental Assistance
Contract, form HUD-90173-B, the Regulatory Agreement, form HUD92466.1-CA, the Use Agreement, form HUD-90163-CA, and the terms and
conditions set forth below.

The capital advance amount, however,

is subject to reduction at final closing as provided in the
Regulations.
1.

2.

a.

There has been filed with HUD a “Master Set” of the
aforementioned Drawings and Specifications of the Project
together with the general conditions of the contract for
the construction of buildings in the standard form of the
American Institute of Architects, current edition, and
Supplementary Conditions, of the contract for
construction which said Master Set shall remain on file
with HUD and be the controlling factor with respect to
any matters which may arise as to language, provisions,
and contents of said “Drawings and Specifications.” In
addition thereto HUD shall be furnished with three
duplicate sets of said Drawings and Specifications at the
time of acceptance of this commitment.

b.

Upon closing of the capital advance mortgage, the Project
shall have been completed in accordance with the
requirements of said Drawings and Specifications except
as they have been modified by changes. All changes in
the Drawings and Specifications must be in writing signed
by the Construction Lender and the Mixed-Finance Owner
and shall be submitted to HUD for comment before changes
are made. It is understood that HUD at all times has the
right to require compliance with the original Drawings
and Specifications.

Prior to the start of construction the following documents
must be filed with HUD:

Form HUD-2453.1-CA (9/2007)
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a.

Agreement and Certification (For use in Capital Advance
Upon Completion cases), form HUD 93566.1-CA

b.

The Owner-Architect Agreement, AIA Form B-181, with HUD
Amendment.

c.

The Agreement to Enter Into a Project Rental Assistance
Contract (forms HUD-90172-A-CA and HUD-90172-B-CA). (To
be prepared by HUD)

3.

During the course of construction, HUD representatives shall
at all times have access to the property and the right to
inspect progress of construction. The inspection of
construction by HUD representatives shall be solely for the
benefit and protection of HUD and no other party.

4.

If under the laws of the jurisdiction in which the project is
located, the personal property of the mixed-finance owner,
which is used in the operation of the project, is not covered
by and subject to the real estate mortgage, the mixed-finance
owner shall provide prior to the closing, a Security Agreement
and a Financing Statement (UCC-1) or such other security
instrument as may be necessary to effect a first lien on such
personal property in favor of HUD.

5.

At least 15 working days prior to the anticipated date for
closing, two draft copies (executed where noted) of each of
the following documents and exhibits shall be submitted to
HUD. After review, the place and date of the closing will be
designated, at which time the following documents and exhibits
in final form shall be delivered to HUD for approval:
a.

The Owner's organization documents for the limited
partnership, and Incumbency Certificate, including
evidence of good standing.

b.

The Regulatory Agreement, which will regulate the Owner's
operation of the Capital Advance-assisted units (form
HUD-92466.1-CA). Such instrument shall provide, among
other things, for the establishment of a Reserve Fund for
Replacements under the control of HUD by payment of $
____________________ per annum.

c.

Resolution by Owner's Board authorizing execution of Use
Agreement, Note, Mortgage, Regulatory Agreement,
Incumbency Certificate and updating conflict of interest
certifications and other closing documents.
Form HUD-2453.1-CA (9/2007)
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d.

Lease in conformance with Lease Addendum (if mortgage is
on a leasehold).

e.

Title evidence in conformity with the Regulations which
shall show that title to the property on the date of
closing is vested in the Mixed-Finance Owner free of all
encumbrances, unless previously approved by HUD, other
than the mortgage and free of all reservations of title
(either junior or prior to said mortgage), except such as
are specifically determined to be acceptable by HUD. If
such title evidence is in the form of a title insurance
policy, it shall by its terms inure to the benefit of the
Secretary of Housing and Urban Development.

f.

Evidence of zoning compliance and occupancy permits
issued by legally constituted authorities.

g.

A final “as-built” survey of the mortgaged property
(dated no more than 90 days before final closing),
together with the Surveyor's Certificate, HUD-92457,
(dated within 30 days of final closing), showing that
there are no easements or encroachments upon the subject
property except those acceptable to HUD.

h.

Mortgage or Deed of Trust (using form HUD-90165-CA as a
guide) and a Mortgage Note, HUD-93432-CA, to ensure HUD's
interest in the capital advance.

i.

Evidence satisfactory to HUD showing that adequate sewer,
water, gas and electric facilities have been fully
installed and that necessary public streets, sidewalks
and curbing outside the project site have been completed.
All off-site facilities or utilities as may be required
by special conditions of this commitment shall be
included in such evidence.

j.

Request for Closing, Certificate of Construction Lender,
Mixed-Finance Owner and General Contractor (For Capital
Advance Upon Completion only), form HUD 9015.1-CA.

k.

The Owner's Attorney's Closing Opinion (59 FR 101443
dated March 3, 1994).

l.

Escrow Agreement for Unpaid Construction Costs, form HUD
90171-CA.

Form HUD-2453.1-CA (9/2007)
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m.

FHEO Assurance of Compliance with nondiscrimination and
equal opportunity requirements. (Appendix 23 of Handbook
4571.2 (Section 811) and 4571.3 (Section 202).

n.

Evidence that the Owner has obtained the required
property insurance coverage (see form HUD-90164-CA).

o.

Use Agreement (form HUD-90163.1-CA).

p.

Direct Deposit Sign-Up Form, SF 1199A (executed). The
designated depository must be insured by the Federal
Deposit Insurance Corporation, Savings Association
Insurance Fund, or the National Credit Union Share
Insurance Fund.

q.

Contractor’s Prevailing Wage Certificate Form 2448.

r.

Owner's executed requisition for advance for capital
advance funds (form HUD-92403-CA).

s.

Evidence that the work of the general contractor is
covered by a guarantee, running for a period of one year
from the date of 100% project completion, against defects
due to faulty materials and/or workmanship.

t.

The mixed-finance owner’s cost certification (form HUD92330) and supporting documentation.

u.

Conflict/identity of interest certification.

v.

All other applicable documents (as noted below).

6.

All certificates, documents and agreements called for by this
commitment, shall be on forms approved or prescribed by HUD
and shall be completed, executed and filed in the number of
copies and in such manner as prescribed by HUD.

7.

Construction shall commence upon the Project within 90 days
from the date of this commitment and must be continued
thereafter diligently to completion. If construction is not
started within such time this commitment shall terminate
unless the time for commencement of construction is extended
by in writing by HUD.

8.

This commitment shall expire ____________, 20__ unless renewed
or extended in writing by HUD and upon such expiration all
right and obligations of the respective parties shall cease.
Form HUD-2453.1-CA (9/2007)
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9.

Evidence that the Owner has escrowed with HUD or its designee
at closing:
a.

A minimum capital investment of $ ______________,
representing one-half of one percent of the total HUD
approved capital advance (not to exceed $10,000 for
Section 811 projects or $25,000 for Section 202
projects); and

b.

Operating escrow account for non-capital advance-assisted
units in the amount $ ___________ to cover operating
expenses of those units.

10.

Any change in the sponsorship or limited partnership owner
upon which this commitment is predicated must be requested in
writing by the mixed-finance owner on behalf of any proposed
substitute entity, and such request must be approved in
writing by HUD. Any sponsor or principal (including the
principals of any parent entity of such sponsor), who is now
or who may later become involved in this project by way of
financial interest, employment or otherwise, who has not filed
a certificate with HUD fully disclosing his/her previous
participation in HUD housing programs and a conflict of
identity-of-interest certification, shall file such
certificates on the form prescribed for HUD approval.

11.

The following documents are attached and incorporated herein:
a.
b.

Rental H
Supplement to Analysis, HUD-92264-A.

Special conditions set forth below or attached hereto and
identified as additional numbered paragraphs are made a part
hereof.

Secretary of Housing and Urban
Development
Date: _______________

By __________________________________
Authorized Agent

The above commitment is hereby acknowledged by the
undersigned, and we hereby agree to be bound by the terms thereof.
Form HUD-2453.1-CA (9/2007)
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ATTEST:

________________________________
Mixed-Finance Owner

______________________________

By _____________________________

ATTEST:

________________________________
Construction Lender

______________________________

By _____________________________

Form HUD-2453.1-CA (9/2007)
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