506.01

Dependency and Medicaid Transition Reserve

Requirements

You must analyze the EGI EGIFor any specified period, the Property's total Net Rental Income, plus commercial income, plus other income, all calculated per Part II, Chapter 2: Valuation and Income, Section 203: Income Analysis and the applicable products and features in Part III. to determine the percentage derived from payments under a Medicaid provider agreement with a government authority or managed care organization (Medicaid Funds Medicaid FundsFunds paid to a provider by governmental authorities or managed care organizations, under Medicaid provider agreements. ).

Operating Procedures

If more than 20% of the EGI EGIFor any specified period, the Property's total Net Rental Income, plus commercial income, plus other income, all calculated per Part II, Chapter 2: Valuation and Income, Section 203: Income Analysis and the applicable products and features in Part III. is derived from Medicaid Funds Medicaid FundsFunds paid to a provider by governmental authorities or managed care organizations, under Medicaid provider agreements. , Fannie Mae Fannie MaeThis Glossary term Is Created Using Automation in Lower Environments and is used for testing purposes only!! may require that you

  • establish a Medicaid transition reserve account, and/or
  • enter into an account control agreement with the Borrower BorrowerPerson who is the obligor per the Note. .

If Fannie Mae Fannie MaeThis Glossary term Is Created Using Automation in Lower Environments and is used for testing purposes only!! requires a Medicaid transition reserve, you must:

  • determine the appropriate amount of the reserve by considering the
    • reimbursement rates of the government authority or managed care organization, and
    • percentage of Medicaid-supported residents at the Property PropertyMultifamily residential real estate securing the Mortgage Loan, including the fee simple or Leasehold interest, Improvements, and personal property (per the Uniform Commercial Code). ;
  • ensure that the Borrower BorrowerPerson who is the obligor per the Note. sufficiently funds the reserve; and
  • use the Modifications to Multifamily Loan and Security Agreement (Medicaid Transition Reserve) ( Form 6237.SRS ) and Modifications to Multifamily Loan and Security Agreement – Addenda to Schedule 2 – Summary of Loan Terms (Medicaid Transition Reserve) ( Form 6102.21.SRS ).

If Fannie Mae Fannie MaeThis Glossary term Is Created Using Automation in Lower Environments and is used for testing purposes only!! requires an account control agreement, you must

  • require the Borrower BorrowerPerson who is the obligor per the Note. to deposit the Medicaid Funds Medicaid FundsFunds paid to a provider by governmental authorities or managed care organizations, under Medicaid provider agreements. into a controlled account,
  • include in the agreement an acknowledgement of Fannie Mae Fannie MaeThis Glossary term Is Created Using Automation in Lower Environments and is used for testing purposes only!! ’s first Lien LienLien, mortgage, bond interest, pledge, security interest, charge, or encumbrance of any kind. on, and control over, the Medicaid Funds Medicaid FundsFunds paid to a provider by governmental authorities or managed care organizations, under Medicaid provider agreements. , and
  • obtain Fannie Mae Fannie MaeThis Glossary term Is Created Using Automation in Lower Environments and is used for testing purposes only!! 's approval if you elect not to use Fannie Mae Fannie MaeThis Glossary term Is Created Using Automation in Lower Environments and is used for testing purposes only!! 's form.