10 Abr Hud Operator Regulatory Agreement
HUD has received comments requesting technical treatments on master rental documents. The commentator indicated that landlords should have the right to increase rents without HUD`s prior approval. As noted in response to another commentator, HUD acknowledges that the borrowers` regulatory agreement does not impose requirements for a HUD PRE PERMIT for rent increases. One commentator indicated that the HUD -91116-ORCF form should be amended to reflect the fact that the borrower`s regulatory agreement requires only prior authorization from HUD if rents in the lease are reduced. HUD accepted the observation and reviewed this document and related documents, which was not clear whether HUD authorization was necessary to increase rents. Another commentator noted that landlords could unilaterally increase the rents of third parties and owner tenants. To address this issue, HUD has added additional language to address the concerns of third parties. Lenders` submissions were not significantly changed as a result of the 30-day and 15-day communication. Based on public comments, the «Lender Narratives» have been amended to reflect several changes to key issues related to clarity and consideration of the changing regulatory environment. The new loan documents generally reflect HUD`s efforts to align the documents with the LEAN manual published last year. For example, the definition of «principle» in the safety instrument and regulatory agreements has been revised to refer to the LEAN manual, contrary to the federal regulations code. The borrower`s revised regulatory agreement contains a supplementary list, in accordance with Section 38, which is applied by the most important principles (this revision is in line with the POPs regulatory agreement).
As part of this review, specific references to the key principles of the note and mortgage are replaced by a general reference to this section 38 supplement. In addition, the regulatory agreement on borrowers (section 29) and the regulatory operator agreement (section 13) will be revised to refer to the management addendum required by huD and to remove the specific requirements of the administrative agreement. Construction contract: Article 1, Point A, is revised to require HUD`s written agreement on possible ancillary restrictions, rather than simply disclosed. Other revisions to the construction contract eliminate the incentive payment potential for «flat-rate contracts» and provide exposure for the calculation of incentive payments for «cost-plus» contracts. In addition, the construction contract has been revised to eliminate the potential for early start-up before engagement, but it leaves the potential for an early start after engagement. These marking elements allow the user to see how the document follows the document creation manual that agencies use to create their documents.