Cambridge Realty Capital Ltd. of Illinois announced that during the first half of 2020, it funded over $200,000,000 in loan modifications, resulting in a lower interest rate for the Borrowers of 16 healthcare facility mortgages which are currently insured by HUD. The healthcare facilities are located in Illinois, California, Ohio, Oklahoma, Texas, New Jersey, and Iowa. The loan modifications were made possible through the HUD Interest Rate Reduction Program.
Loan Modifications are mutually beneficial to both the Borrowers and HUD, as the Borrower receives a lower permanent interest rate resulting in lower mortgage payments, and HUD’s risk is minimized by a more rapid amortization of principal, as Loan Modifications simply reduce the permanent interest rate while keeping the loan maturity the same.
HUD approval for Loan Modifications typically takes less than two weeks, and Loan Modifications are often funded within 30 days of the initial application.
Cambridge Realty Capital Chairman Jeffrey Davis says that HUD is to be applauded for the fast approval turnarounds which provide much-needed financial relief to healthcare facilities facing significant challenges in the world of COVID-19.
