1. I WANT TO BE A GENERAL CONTRACTOR ON A HUD DEAL
YES!...OF COURSE!
I WANT TO BE A GENERAL CONTRACTOR ON A HUD DEAL

2. Qualify to be the GC Licensed GC: no HUD experience OK
Previous Participation: Form 2530
Supplement to Application: Form 2013S
5% Working Capital
100%-105% P&P Bond; Cash or LOC of 15% for 1-4 stories; 25% for 5+ stories

3. Cost the Job
Form 2328 and 2328 LI
Davis-Bacon Wages: residential, building, heavy, highway at
BSPRA or SPRA
Demolition and Off-Site Costs not mortgagable, in land value

5. AGM Review by JPS
Review for Costs with independent cost analysis: approved within 5% of GC estimate of costs
Review for ADA and Fair Housing

6. Sign the Contract at IE Contract: Form 2442M
General Conditions: Form AIA
Supplementary Conditions: Form 2554M
HUD Special Conditions from Firm
Plans
Specifications

7. Sign the Contract at IE Costs: Form 2328 and 2328LI
Incentive Pay’t: Form 2443 soft costs
Prevailing Wages (DB wages)
Identities of Interest
Changes Orders already approved
Retainage Reduction Rider

8. In Your Office Pre-Construction Meeting w/ Leetex
Form 2448 for the Draw; AGM pays within 5 BD of Form 2403
10% Retainage; 5% at 50% complete; 2.5% at 75%; 0% at Next to Final Draw or Final Endorsement
GC wants retainage; Borrower wants to avoid extension fees at FE

9. On the Job Site Start within 10 days of Closing: no early start
2 Monthly Draws/ Inspections: Leetex: end of month signs the draw
Post DB Wages outside the Trailer
Keep Plans and Specs in Trailer
Trip Report: Form prepared by HUD Inspector

10. On the Job Site Post Construction Sign
Subcontractor Employees interviewed by the HUD Inspector about DB Wages
Off-site Stored Material OK
Permission to Occupy: Form 2485
9 and 12-month inspections for defects

11. See…AGM KNOWS CONSTRUCTION!

12. Other Things to Know Liquidated Damages if complete late
= 0.01 / 1,000 x Int. Rate x 100 x 4 x Mortgage Amount.
.01/1000 x .05 x 100 x 4 x $10,000,000 = $2,000 daily
Liquidated damages (LD) are the lower of actual damages or the amount calculated above.

13. Other Things to Know Prepare Change Orders Form 92437:
Positive, Deduct, Equivalent, Time
Time extension = 65% of gen’l reqs per month; 7-day minimum
Betterments for mortgage increase, Necessities for cost cert, mort incr
NC has 4% Cash or LOC with half for contingency; SR has 10%-15% in mortgagable costs

14. Other Things to Know Fair Housing: when 39” is not 40”
Report DB wages: Elationsys.com
Anticipated Draws: Form 5372
Section 3 best efforts/ federal $
Cost Cert: Form 2330 except LIHTCs when mortgage is <80% of costs.
Supplemental Services Fee and Supplemental Incentive Fee

15. Questions / Comments
Margaret Allen If you liked this, we offer Chapter 12 of the MAP Guide!