Supporting Statement for Paperwork Reduction Act Submissions
HUD Multifamily Rental Project Closing Documents
OMB Control No.: 2502-0598
A. Justification
1. Explain the circumstances that make the collection of information necessary. Identify any legal or administrative requirements that necessitate the collection. Attach a copy of the appropriate section of each statute and regulation mandating or authorizing the collection of information.
The National Housing Act (12 U.S.C. 1701 et seq.) requires a Lease Addendum for a mortgaged property that is subject to a ground lease.
Under Title II of the National Housing Act, HUD is authorized to insure mortgage loans upon certain multifamily rental housing projects and health care facilities (nursing homes, extended care facilities, board and care homes and hospitals). HUD is also authorized and directed to make such rules and regulations as may be necessary to carry out the provisions of Title II. (See 12 USC 1715b). Generally, the mortgages are defined as those "commonly given" in the various States; therefore, State and local law govern virtually the entire mortgage insurance transaction from the formation of the mortgagor entity to the making and securitization of the loan to the construction of the project in accord with local law. Consequently, prior to endorsement of a mortgage note for insurance in connection with a multifamily rental facility, it is imperative that HUD knows the precise legal status of the mortgagor entity and of the realty and personality that will comprise the security property.
HUD’s regulations at 24 CFR 200.45 provide the regulatory authority for the collection of all exhibits and documents in support of an application for mortgage insurance. “Upon approval of an application for insurance, a commitment shall be issued by the Commissioner setting forth the terms and conditions upon which the mortgage will be insured.”
HUD’s regulation at 24 CFR 200.46 provides as follows: “Upon approval of an application for insurance, a commitment shall be issued by the Commissioner setting forth the terms and conditions upon which the mortgage will be insured. The commitment term and any extension or reopening of an expired commitment shall be in accordance with standards established by the Commissioner.”
HUD’s regulation at 24 CFR 200.50 provides as follows: “The mortgagor and mortgagee must execute a building loan agreement approved by the Commissioner that sets forth the terms and conditions under which progress payments may be advanced during construction, before initial endorsement of the mortgage for insurance.”
HUD’s regulation at 24 CFR 200.51 provide that the mortgagee shall certify to the Commissioner that it will conform with terms and conditions established by the Commissioner for the mortgagee’s control of project funds, and other incidental requirements established by HUD.
HUD’s regulation at 24 CFR 200.52 provides as follows: “The form of contract between the mortgagor and builder shall be as prescribed by the Commissioner in accordance with terms and conditions established by the Commissioner.”
HUD’s regulation at 24 CFR 200.54 provides, in relevant part, as follows: “Except as provided in paragraph (d) of this section, the mortgagor shall deposit with the mortgagee cash deemed by the Commissioner to be sufficient, when added to the proceeds of the insured mortgage, to assure completion of the project and to pay the initial service charge, carrying charges, and legal and organizational expenses incident to the construction of the project.” This requirement may be delegated to the Contractor, when the Borrower is not serving as the Contractor.
HUD’s regulation at 24 CFR 200.61 provides, in relevant part, as follows: “Title evidence for the Commissioner's examination shall include a lender's title insurance policy, which title policy provides survey coverage based on a survey acceptable to the title company and the Commissioner; or as the Commissioner may otherwise require, in accordance with terms, conditions and standards established by the Commissioner.”
HUD’s regulation at 24 CFR 200.100 provides as follows in paragraph (b): “Final endorsement. When all advances of mortgage proceeds have been made and all the terms and conditions of the commitment have been met to the Commissioner's satisfaction the Commissioner shall indicate on the original credit instrument the total of all advances approved for insurance and again endorse such instrument.”
HUD’s regulation at 24 CFR 200.105 provides as follows: “As long as the Commissioner is the insurer or holder of the mortgage, the Commissioner shall regulate the mortgagor by means of a regulatory agreement providing terms, conditions and standards established by the Commissioner, or by such other means as the Commissioner may prescribe.”
2. Indicate how, by whom and for what purpose the information is to be used. Except for a new collection, indicate the actual use the agency has made of the information received from the current collection.
3. Describe whether, and to what extent, the collection of information involves the use of automated, electronic, mechanical, or other technological collection techniques or other forms of information technology, e.g., permitting electronic submission of responses, and the basis for the decision for adopting this means of collection. Also describe any consideration of using information technology to reduce burden.
Because the documents are used in a real estate closing and real estate closings across the nation continue to be conducted with hard copy documents and hard copy documents must be filed with the applicable court for recordation, there is no consideration at this time for using an information technology system. However, HUD will provide the forms in pdf fillable/printable format via the HUD website.
4. Describe efforts to identify duplication. Show specifically why any similar information already available cannot be used or modified for use for the purposes described in Item 2 above.
There is no duplication of information. These documents are standard documents in multifamily housing closings.
5. If the collection of information impacts small businesses or other small entities (Item 5 of OMB Form 83-I) describe any methods used to minimize burden.
The collection of this information will not impact small businesses or other small entities. This document reduces burden by requiring use of these documents for all the various multifamily rental housing projects, except for healthcare facilities, and not requiring these documents to be individually tailored for the transaction.
6. Describe the consequence to Federal program or policy activities if the collection is not conducted or is conducted less frequently, as well as any technical or legal obstacles to reducing burden.
FHA insurance would not be available to the borrower, and therefore the multifamily housing transaction, in all likelihood, would not proceed. In this economy, the availability of FHA mortgage insurance is often the factor that helps to maintain the availability of affordable multifamily rental housing. Additionally, HUD must protect the FHA insurance fund, which these multifamily closing documents, along with others is designed to do, by establishing the legal rights and obligations of the parties to the multifamily housing closing transaction.
Also, HUD and the mortgagee would be performing duplicative legal work and would expend considerably greater time and resources than the mortgagor's or owner's counsel, who would be conducting the due diligence analysis as a matter of course in representing the client.
Explain any special circumstances that would cause an information collection to be conducted in a manner:
requiring respondents to report information to the agency more than quarterly- There are no special circumstances surrounding this collection of information.
requiring respondents to prepare a written response to a collection of information in fewer than 30 days after receipt of it- There are no special circumstances surrounding this collection of information.
requiring respondents to submit more than an original and two copies of any document- There are no special circumstances surrounding this collection of information.
requiring respondents to retain records other than health, medical, government contract, grant-in-aid, or tax records for more than three years- While the information collection does not explicitly require the retention of records for more than three years, in addition to the fact that the documents in the collection are mostly certifications and agreements that could possibly be considered government contracts, to the extent the information collection implicitly requires the retention of the documents for more than three years, it is because HUD is insuring mortgage loans pursuant to the National Housing Act (12 USC 1701 et. seq.) for a period of up to forty years. Such long term financing requires the Security Instrument, Note, Regulatory Agreement, and other documents in the collection to be enforceable by HUD and between the program participants (lenders and borrowers) for the same term authorized by statute.
in connection with a statistical survey, that is not designed to produce valid and reliable results than can be generalized to the universe of study- There are no special circumstances surrounding this collection of information.
requiring the use of a statistical data classification that has not been reviewed and approved by OMB- There are no special circumstances surrounding this collection of information.
that includes a pledge of confidentiality that is not supported by authority established in statute or regulation, that is not supported by disclosure and data security policies that are consistent with the pledge, or which unnecessarily impedes sharing of data with other agencies for compatible confidential use- There are no special circumstances surrounding this collection of information.
or
requiring respondents to submit proprietary trade secret, or other confidential information unless the agency can demonstrate that it has instituted procedures to protect the information's confidentiality to the extent permitted by law- There are no special circumstances surrounding this collection of information.
8. If applicable, provide a copy and identify the date and page number of publication in the Federal Register of the agency's notice, required by 5 CFR 1320.8(d), soliciting comments on the information collection prior to submission to OMB. Summarize public comments received in response to that notice and describe actions taken by the agency in response to these comments. Specifically address comments received on cost and hour burden.
Describe efforts to consult with persons outside the agency to obtain their views on the availability of data, frequency of collection, the clarity of instructions and recordkeeping disclosure, or reporting format (if any) and the data elements to be recorded, disclosed, or reported.
Consultation with representatives of those from whom information is to be obtained or those who must compile records should occur at least once every 3 years -- even if the collection of information activity is the same as in prior periods. There may be circumstances that preclude consultation in a specific situation. These circumstances should be explained.
In accordance with 5CFR 1320.8(d), this information collection soliciting public comments was announced in the Federal Register on September 5, 2017, Volume 82, No. 170, Pages 41977. (4) Comments received.
9. Explain any decision to provide any payment or gift to respondents, other than remuneration of contractors or grantees.
No gifts or payments are provided other than the provision of mortgage insurance, and the payment of insurance claim for a validly submitted claim.
10. Describe any assurance of confidentiality provided to respondents and the basis for assurance in statute, regulation or agency policy.
The document contains no personally identifying information subject to privacy requirements.
11. Provide additional justification for any questions of a sensitive nature, such as sexual behavior and attitudes, religious beliefs, and other matters that are commonly considered private. This justification should include the reasons why the agency considers the questions necessary, the specific uses to be made of the information, the explanation to be given to persons from whom the information is requested, and any steps to be taken to obtain their consent.
No questions of a sensitive nature are included in this request.
12. Provide estimates of the hour burden of the collection of information. The statement should:
indicate the number of respondents, frequency of response, annual hour burden, and an explanation of how the burden was estimated. Unless directed to do so, agencies should not conduct special surveys to obtain information on which to base hour burden estimates. Consultation with a sample (fewer than 10) of potential respondents is desirable. If the hour burden on respondents is expected to vary widely because of differences in activity, size, or complexity, show the range of estimated hour burden, and explain the reasons for the variance. Generally estimates should not include burden hours for customary and usual business practices;
if this request covers more than one form, provide separate hour burden estimates for each form and aggregate the hour burdens in Item 13 of OMB Form 83-I; and provide estimates of annualized cost to respondents for the hour burdens for collections of information, identifying and using appropriate wage rate categories. The cost of contracting out or paying outside parties for information collection activities should not be included here. Instead this cost should be included in Item 13.
The burden on each respondent will vary in proportion to the number of multifamily housing rental closings in which the respondent is involved. Generally, because of the high dollar amount of the transaction and the complexity of the transaction (state and local laws factor into such closings), a respondent will only engage in one such transaction during a one-year period.
The ‘burden hours per response’ is based on the time it takes to read and complete each form in preparation for closing. ‘Annual burden hours’ are based on the number of times the form was completed in preparation for closing (‘responses per annum’) multiplied by the amount of time it takes to complete each form. ‘Responses per annum’ varies across forms because not every form is used at every closing that takes place. Use of the form is dependent on the Section of the Act being followed at the time of closing (i.e. Section 221(d)(4), Section 223(f), Section 223(a)(7)). The number of respondents is based on the number of closings held in Fiscal Year 2016.
The ‘hourly cost’ is an estimate based on an average annual salary of $62,000 for developers and mortgagees.
|
Number of Respondents |
Frequency of Response |
Responses per annum |
Burden hours per response |
Annual burden hours |
Hourly Cost |
Total Annual Cost ($) |
HUD-91710M |
100.00 |
1.00 |
100.00 |
0.50 |
50.00 |
$26.00 |
1,300.00 |
HUD-91712M |
100.00 |
1.00 |
100.00 |
0.50 |
50.00 |
26.00 |
1,300.00 |
HUD-92023M |
164.00 |
1.00 |
164.00 |
1.00 |
164.00 |
26.00 |
4,264.00 |
HUD-92070M |
626.00 |
1.00 |
626.00 |
0.50 |
313.00 |
26.00 |
8,138.00 |
HUD-92223M |
200.00 |
1.00 |
200.00 |
0.50 |
100.00 |
26.00 |
2,600.00 |
HUD-92412M |
203.00 |
1.00 |
203.00 |
0.50 |
101.50 |
26.00 |
2,639.00 |
HUD-92414M |
969.00 |
1.00 |
969.00 |
0.50 |
484.50 |
26.00 |
12,597.00 |
HUD-92450M |
203.00 |
1.00 |
203.00 |
0.50 |
101.50 |
26.00 |
2,639.00 |
HUD-92452A-M |
203.00 |
1.00 |
203.00 |
0.50 |
101.50 |
26.00 |
2,639.00 |
HUD-92452M |
203.00 |
1.00 |
203.00 |
0.50 |
101.50 |
26.00 |
2,639.00 |
HUD-92455M |
602.00 |
1.00 |
602.00 |
0.75 |
451.50 |
26.00 |
11,739.00 |
HUD-92456M |
164.00 |
1.00 |
164.00 |
0.50 |
82.00 |
26.00 |
2,132.00 |
HUD-91073M |
969.00 |
1.00 |
969.00 |
0.50 |
484.50 |
26.00 |
12,597.00 |
HUD-92464M |
203.00 |
1.00 |
203.00 |
1.00 |
203.00 |
46.00 |
9,338.00 |
HUD-92476.1M |
602.00 |
1.00 |
602.00 |
0.50 |
301.00 |
26.00 |
7,826.00 |
HUD-92476a-M |
626.00 |
1.00 |
626.00 |
0.50 |
313.00 |
26.00 |
8,138.00 |
HUD-92477M |
203.00 |
1.00 |
203.00 |
0.50 |
101.50 |
26.00 |
2,639.00 |
HUD-92478M |
805.00 |
1.00 |
805.00 |
0.50 |
402.50 |
26.00 |
10,465.00 |
HUD-92479M |
203.00 |
1.00 |
203.00 |
0.50 |
101.50 |
26.00 |
2,639.00 |
HUD-91725M |
969.00 |
1.00 |
969.00 |
2.00 |
1,938.00 |
125.00 |
242,250 |
HUD-91725M-CERT |
969.00 |
1.00 |
969.00 |
2.00 |
1,938.00 |
46.00 |
89,148.00 |
HUD-91725M-INST |
969.00 |
1.00 |
969.00 |
1.00 |
969.00 |
46.00 |
44,574.00 |
HUD-92434M |
203.00 |
1.00 |
203.00 |
0.75 |
152.25 |
26.00 |
3,958.50 |
HUD-92441M |
203.00 |
1.00 |
203.00 |
1.00 |
203.00 |
26.00 |
5,278.00 |
HUD-92442M |
203.00 |
1.00 |
203.00 |
1.00 |
203.00 |
58.00 |
11,774.00 |
HUD-92466M |
805.00 |
1.00 |
805.00 |
0.75 |
603.75 |
58.00 |
35,017.50 |
HUD-92554M |
203.00 |
1.00 |
203.00 |
0.20 |
40.60 |
26.00 |
1,055.60 |
HUD-94000M |
969.00 |
1.00 |
969.00 |
0.75 |
726.75 |
26.00 |
18,895.50 |
HUD-94001M |
969.00 |
1.00 |
969.00 |
1.00 |
969.00 |
26.00 |
25,194.00 |
HUD-93305M |
805.00 |
1.00 |
805.00 |
0.50 |
402.50 |
26.00 |
10,465.00 |
HUD-92476M |
50.00 |
1.00 |
50.00 |
0.50 |
25.00 |
26.00 |
650.00 |
HUD-92420M |
402.00 |
1.00 |
402.00 |
0.50 |
201.00 |
26.00 |
5,226.00 |
HUD-92408M |
203.00 |
1.00 |
203.00 |
2.00 |
406.00 |
103.00 |
41,818.00 |
HUD-91070M |
969.00 |
1.00 |
969.00 |
0.50 |
484.50 |
36.00 |
17,442.00 |
HUD-91071M |
626.00 |
1.00 |
626.00 |
0.50 |
313.00 |
26.00 |
8,138.00 |
HUD-92907M |
403.00 |
1.00 |
403.00 |
0.50 |
201.50 |
26.00 |
5,239.00 |
HUD-92908M |
200.00 |
1.00 |
200.00 |
0.50 |
100.00 |
26.00 |
2,600.00 |
Totals |
|
|
17,468.00 |
|
13,884.85 |
|
676,991.10 |
13. Provide an estimate of the total annual cost burden to respondents or recordkeepers resulting from the collection of information (do not include the cost of any hour burden shown in Items 12 and 14).
The cost estimate should be split into two components: (a) a total capital and start-up cost component (annualized over its expected useful life); and (b) a total operation and maintenance purchase of services component. The estimates should take into account costs associated with generating, maintaining, and disclosing or providing the information. Include descriptions of methods used to estimate major cost factors including system and technology acquisition, expected useful life of capital equipment, the discount rate(s) and the time period over which costs will be incurred. Capital and start-up costs include, among other items, preparations for collecting information such as purchasing computers and software; monitoring, sampling, drilling and testing equipment; and record storage facilities;
If cost estimates are expected to vary widely, agencies should present ranges of cost burdens and explain the reasons for the variance. The cost of purchasing or contracting out information collection services should be a part of this cost burden estimate. In developing cost burden estimates, agencies may consult with a sample of respondents (fewer than 10) utilize the 60-day pre-OMB submission public comment process and use existing economic or regulatory impact analysis associated with the rulemaking containing the information collection, as appropriate.
generally, estimates should not include purchases of equipment or services, or portions thereof made: (1) prior to October 1, 1995, (2) to achieve regulatory compliance with requirements not associated with the information collection, (3) for reasons other than to provide information or keep records for the government, or (4) as part of customary and usual business or private practices.
There are no capital or start-up costs. There are no cost burdens to respondents for operation and maintenance
14. Provide estimates of annualized cost to the Federal government. Also, provide a description of the method used to estimate cost, which should include quantification of hours, operational expenses (such as equipment, overhead, printing, and support staff), and any other expense that would not have been incurred without this collection of information. Agencies also may aggregate cost estimates from Items 12, 13, and 14 in a single table.
All MF Closing documents are reviewed by an attorney in one of HUD’s Field Offices. The attorneys range from GS-12s to GS-14s. The GS-13 pay grade is used as an average. The time it takes to review each document corresponds to the time that it takes for the respondent to complete the form. Per the following website, the hourly rate of a GS-13 attorney is $ 51.48 (rounded to $51): www.opm.gov/oca/10tables/html/RUS.asp.
Based on an hourly rate of $51, the average, annual labor cost will be approximately $708,128 for the review of all closing documents under all Sections of the Act.
|
Number of Respondents |
Frequency of Response |
Responses per annum |
Burden hours per response |
Annual burden hours |
Hourly Cost |
Total Annual Cost ($) |
HUD-91710M |
100.00 |
1.00 |
100.00 |
0.50 |
50.00 |
51.00 |
2,550.00 |
HUD-91712M |
100.00 |
1.00 |
100.00 |
0.50 |
50.00 |
51.00 |
2,550.00 |
HUD-92023M |
164.00 |
1.00 |
164.00 |
1.00 |
164.00 |
51.00 |
8,364.00 |
HUD-92070M |
626.00 |
1.00 |
626.00 |
0.50 |
313.00 |
51.00 |
15,963.00 |
HUD-92223M |
200.00 |
1.00 |
200.00 |
0.50 |
100.00 |
51.00 |
5,100 |
HUD-92412M |
203.00 |
1.00 |
203.00 |
0.50 |
101.50 |
51.00 |
5,176.50 |
HUD-92414M |
969.00 |
1.00 |
969.00 |
0.50 |
484.50 |
51.00 |
24,709.50 |
HUD-92450M |
203.00 |
1.00 |
203.00 |
0.50 |
101.50 |
51.00 |
5,176.50 |
HUD-92452A-M |
203.00 |
1.00 |
203.00 |
0.50 |
101.50 |
51.00 |
5,176.50 |
HUD-92452M |
203.00 |
1.00 |
203.00 |
0.50 |
101.50 |
51.00 |
5,176.50 |
HUD-92455M |
602.00 |
1.00 |
602.00 |
0.75 |
451.50 |
51.00 |
23,026.50 |
HUD-92456M |
164.00 |
1.00 |
164.00 |
0.50 |
82.00 |
51.00 |
4,182.00 |
HUD-91073M |
969.00 |
1.00 |
969.00 |
0.50 |
484.50 |
51.00 |
24,709.50 |
HUD-92464M |
203.00 |
1.00 |
203.00 |
1.00 |
203.00 |
51.00 |
10,353 |
HUD-92476.1M |
602.00 |
1.00 |
602.00 |
0.50 |
301.00 |
51.00 |
15,351 |
HUD-92476a-M |
626.00 |
1.00 |
626.00 |
0.50 |
313.00 |
51.00 |
15,963 |
HUD-92477M |
203.00 |
1.00 |
203.00 |
0.50 |
101.50 |
51.00 |
5,176.50 |
HUD-92478M |
805.00 |
1.00 |
805.00 |
0.50 |
402.50 |
51.00 |
20,527.50 |
HUD-92479M |
203.00 |
1.00 |
203.00 |
0.50 |
101.50 |
51.00 |
5,176.50 |
HUD-91725M |
969.00 |
1.00 |
969.00 |
2.00 |
1,938.00 |
51.00 |
98,838.00 |
HUD-91725M-CERT |
969.00 |
1.00 |
969.00 |
2.00 |
1,938.00 |
51.00 |
98,838.00 |
HUD-91725M-INST |
969.00 |
1.00 |
969.00 |
1.00 |
969.00 |
51.00 |
49,419.00 |
HUD-92434M |
203.00 |
1.00 |
203.00 |
0.75 |
152.25 |
51.00 |
7,764.75 |
HUD-92441M |
203.00 |
1.00 |
203.00 |
1.00 |
203.00 |
51.00 |
10,353.00 |
HUD-92442M |
203.00 |
1.00 |
203.00 |
1.00 |
203.00 |
51.00 |
10,353.00 |
HUD-92466M |
805.00 |
1.00 |
805.00 |
0.75 |
603.75 |
51.00 |
30,791.25 |
HUD-92554M |
203.00 |
1.00 |
203.00 |
0.20 |
40.60 |
51.00 |
2,070.60 |
HUD-94000M |
969.00 |
1.00 |
969.00 |
0.75 |
726.75 |
51.00 |
37,064.25 |
HUD-94001M |
969.00 |
1.00 |
969.00 |
1.00 |
969.00 |
51.00 |
49,419.00 |
HUD-93305M |
805.00 |
1.00 |
805.00 |
0.50 |
402.50 |
51.00 |
20,527.50 |
HUD-92476M |
50.00 |
1.00 |
50.00 |
0.50 |
25.00 |
51.00 |
1,275.00 |
HUD-92420M |
402.00 |
1.00 |
402.00 |
0.50 |
201.00 |
51.00 |
10,251.00 |
HUD-92408M |
203.00 |
1.00 |
203.00 |
2.00 |
406.00 |
51.00 |
20,706.00 |
HUD-91070M |
969.00 |
1.00 |
969.00 |
0.50 |
484.50 |
51.00 |
24,709.50 |
HUD-91071M |
626.00 |
1.00 |
626.00 |
0.50 |
313.00 |
51.00 |
15,963.00 |
HUD-92907M |
403.00 |
1.00 |
403.00 |
0.50 |
201.50 |
51.00 |
10,276.50 |
HUD-92908M |
200.00 |
1.00 |
200.00 |
0.50 |
100.00 |
51.00 |
5,100.00 |
Totals |
|
|
17,468 |
|
13,884.85 |
|
708,127.35 |
15. Explain the reasons for any program changes or adjustments reported in Items 13 and 14 of the OMB Form 83-I.
The current collection has been revised with the addition of two new forms (HUD-92907M and HUD-92908M) and of one obsolete form (HUD-92441M-SUPP), neither of which significantly impact the changes reported in line 13 of the OMB Form 83-I. The reason for the decrease in burden hours reported in Item 13 is the decrease in the annual number of FHA multifamily loan closings between those reported in the Supporting Statement for this collection submitted in 2014 (1250) and the number of annual loan closings that serves as the basis for the present Supporting Statement (969). The number of annual loan closings drives the number of annual responses for the approved collection. Since 2014, FHA’s multifamily production has curtailed, largely as a result of market forces; thus, there has been a decrease in the reported burden of this approved collection.
16. For collection of information whose results will be published, outline plans for tabulation and publication. Address any complex analytical techniques that will be used. Provide the time schedule for the entire project, including beginning and ending dates of the collection of information, completion of report, publication dates, and other actions.
The information will not be published.
17. If seeking approval to not display the expiration date for OMB approval of the information collection, explain the reasons that display would be inappropriate.
There is no request to not display the expiration date.
18. Explain each exception to the certification statement identified in item 19.
There are no exceptions to the certification statement identified in item 19.
B. Collections of Information Employing Statistical Methods
This collection will not employ statistical methods.
File Type | application/msword |
File Title | Paperwork Reduction Act Submission |
Author | HUDWARE II |
Last Modified By | SYSTEM |
File Modified | 2018-06-28 |
File Created | 2018-06-28 |