HUD s CNA e-tool Hands-On Training Office of Multifamily Housing Programs
The CNA e-tool an important step in Multifamily toward a more efficient and consistent underwriting approach 2
Welcome to the Field Office 3
Quick Overview There are no new rules about when a CNA is required There are no new rules about how a CNA must be conducted There are, however, new rules about how a CNA must be submitted to HUD Effective November 1, 2017 for FHA mortgage insurance Also used for RAD, Asset Management, and several other programs 4
Agenda 9:00 Welcome + Introduction + Orientation Practice Submission The CNA e-tool Panels and Reports Resource Tour 12:00 Lunch Break 1:00 The Assessment Tool Practice Submission #2 ( permitting) The Ask a Question Resource 4:00 End 5
Why Are We In A HUD Computer Room? So you can practice in the Submission Portal This is HUD s test environment, and it s available only on HUD computers When you submit a CNA in the production environment, it is for real Some functions you re about to see can be used within the production environment prior to actually submitting, though So let s take full advantage of your time in the Submission Portal today 6
The Sample Project Hypothetical project 1990s market rate project 3 story, breezeway 12 unit buildings 240 units total 7
The Planned Transaction Existing financing matures in 18 months Owner wants to upgrade the property, make it much more energy-efficient, and raise rents 223(f) refinancing is planned Rehab budget $4.0 million ($16,628 per unit) Pursuing the Green MIP reduction through LEED Bronze and utility benchmarking 8
Your Role You are the lender You have received and reviewed the CNA. You have completed Financial Factors and developed an RfR approach. You are ready to submit your 223(f) firm commitment package. 9
As the Lender: The Assessor emailed you the CNA previously You have reviewed the CNA and found it acceptable You have developed a Reserve funding approach that works for you and that meets HUD s requirements You ve done the Amortization Test Tool to confirm compliance with MAP Guide You want to submit the CNA to HUD 10
Log In To Your COMPUTER (First of TWO separate logins) Find your login credentials (on agenda) Enter your COMPUTER username Enter your COMPUTER password Your computer s desktop should have a CNA e-tool Training folder, which includes: CNA e-tool Training URLs (MS Word document) MS Excel files One PDF file KEEP YOUR LOGIN CREDENTIALS HANDY TODAY! 11
If Your COMPUTER Goes to Sleep, You Unlock it With This ID and PW Find the Windows Key on your keyboard: Do Windows-L to lock your computer Now unlock it with CTL+ALT+DEL, then enter these credentials again 12
Your Practice CNA Submission 13
Your Practice Submission, Part 1 Prepare the Assessment Tool [SAMPLE] In the CNA e-tool Training folder, find Bay View Apartments Assessment Tool sample Double-click to open it Do a File / Save As, create a short filename that you will remember later (.XLS) Click the Open Form button On the Property Information Form, create a new property name and random irems # Click Update Do File / Save 14
Your Practice Submission, Part 2 Login to the SUBMISSION PORTAL [TEST] (This is the SECOND login to the PORTAL) In the CNA e-tool Training folder, find and open CNA e-tool Training URLs document Click on Submission Portal [Test Environment] Enter the MCNTxx ID and password from your agenda (password is case sensitive!) You should see a Legal Warning; click accept at the bottom of the screen. You will see a Main Menu; Select CNA etool Notice you start in the CNA Submission tab 15
Your Practice Submission, Part 3 Validate the Assessment [SAMPLE] Notice you are in the CNA Submission tab Click the CHOOSE FILE button, then find the Sample Assessment Tool that you saved with the new short recognizable filename. Select that file Click Validate 16
Your Practice Submission, Part 4 You Are Here 17
Locate CNA Looks Like This 18
Your Practice Submission, Part 5 Include Attachments [SAMPLES] Return to the CNA Submission Tab Expand the Flags Panel Expand the Attachments panel Attach the Statement of Energy Performance Attach the Seismic Factors In real life, you would attach other items too, such as photos. We won t do that now. Now find the Submit button, and the certification wording. 19
Your Practice Submission, Part 6 Certification Notice the Certification wording at the bottom of the window. Also see MAP Guide Appendix 5G.VII.D.3: I am authorized to bind my firm and to submit Capital Needs Assessments via the web portal for the CNA e-tool. We have reviewed the Capital Needs Assessment and all relevant attachments submitted with it. [etc.] Now Click Submit 20
Congratulations You have submitted a CNA! 21
If the CNA Needs to be Revised The HUD Reviewer must Return the CNA to you The Assessment Tool must be revised as needed The Assessment Tool, and all Attachments, must be Submitted again The repair results and Reserve funding schedule can be changed only by revising the Assessment Tool and re-submitting it Attachments can be revised only by re- Submitting the entire package 22
Morning Break Be back at 23
The Four Tools in the CNA e-tool Toolbox The Assessment Tool (Excel) The Validation Engine (Web) Open to the public The Submission Portal (Web) The Reviewer Tool (Web) Open to credentialed users such as lenders Open only to HUD Reviewers and supervisors 24
Validation, Submission, Review, Approval 25
Exploring Panels and Reports We will have a look at the panels and reports You ll learn how to work with the panels You ll learn what the reports contain 26
Resource Tour CNA e-tool Home Page MAP Guide Home Page Instructions for use User Access Guide(s) Mortgagee Letters HUD Exchange Resources 27
Questions? 28
The Ask A Question (AAQ) Resource Link on CNA e-tool homepage HUDExchange.info > Program Support > Ask A Question 29
Lunch Break Be back at 30
Highlights of the Assessment Tool We will explore key aspects of the Assessment Tool This is a selection of key inputs, not a comprehensive tour. The comprehensive reference is the Instructions for Use of the CNA Assessment Tool v1.2 (as amended). 31
Use the Forms Use the Forms rather than the Worksheets Use the Action Button (Add, Update, Change) Issues with two Excel Workbooks (files) open Save the Assessment Tool periodically, the Action Button does not save the Assessment Tool, and the Forms block the normal Auto- Save process. 32
Building the Project Electronically (Property > Units and Common Spaces) Detailed guidance exists in the Instructions for use of the CNA e-tool 33
Components, Alternatives, Recommendations, and Decisions 34
Financial Factors Form Initial rates for inflation and interest are current and external (e.g. President s budget, WSJ) (MAP Guide, Appendix 5G, VII.C.) Next rates for inflation and interest are longterm average and external (e.g. President s budget, WSJ) Escalation of annual RfR deposit is up to the Lender but is capped at the inflation rate. 35
Duration (spreading) Duration (Assessment Tool / Repair Replace Decision) allows the user to spread out the replacements. Any input in Duration spreads the replacements out for that number of years before and after the replacement year. If the RUL is 5, and the Duration is 2, the replacements occur evenly in years 3 (RUL 2) through 7 (RUL +2) 36
Accessibility FHA Accessibility Requirements It s by building For properties built 1990-1992 applicability depends on building permit date and occupancy permit date 37
Accessibility Federally Assisted Indicator Federally Assisted Indicator (in the Property tab) This is for 504 compliance Once assisted, always assisted 38
Accessibility RE: Units and Common Spaces In the Units and Common Spaces Mobility accessible unit = 504 and fully compliant Sensory accessible unit = 504 and fully compliant Public Accommodation (in the Common Spaces sub-tab of Units and Common Spaces) A common area that s open to the public, e.g. the leasing office. This is for ADA 39
Additional Tests Is there any test that was done by a third party (such as a seismic engineer)? If yes, HUD will expect a corresponding attachment. Examples: structural engineering report, sewer scoping report 40
Parking Basic entry on the Sites Form Accessible spaces are in addition to other spaces Some parking is entered on the Site Form Some parking is entered on the Buildings Form Two types of parking are entered on the Units and Common Spaces Form 41
The Inspection Sample The actual sample is entered on the Inspected Sample worksheet. HUD recommends determining the sample in advance of the site visit, and also making plans for identifying substitute units when a selected unit isn t available for inspection. The Validation software checks that the % of units sampled for each building (Flag DU 001) and by the Unit types (Flag DU-009) meet the MAP requirements. 42
Other Important Topics Building Envelope Alternatives utility usage can be negative Copy Building Ground Floor Naming the Component IDs Seismic Unit Types Utility Benchmarking 43
Be back at Afternoon Break 44
Submit CNA with a Flag and Notes Step 1 we will upload a CNA with a Severe Flag, then go to the Assessment Tool and correct the issue, resave, and resubmit. Be sure to create a different, random irems # Step 2 we will demonstrate inserting Flag Notes. 45
The Ask A Question (AAQ) Resource Link on CNA e-tool homepage HUDExchange.info > Program Support > Ask A Question 46
Training Evaluation Form Please complete, your feedback is helpful 47
Thank you! 48