If you are looking to get a HUD loan application approved in seismic zones 3 or 4, you will need to obtain a seismic assessment from an experienced, licensed engineer. HUD seismic assessments necessitate high levels of expertise in order to meet HUD standards, otherwise the loan application may be rejected.
Here is some more information about HUD, what its seismic assessments consist of, and how they are used.
About HUD
The Department of Housing and Urban Development is the Federal agency that is responsible for policies and programs for U.S. housing needs. Its mission is to create decent, suitable living environments for all Americans. Moderate-income and low-income housing comes in all sizes and types, from single-family homes to elderly apartments. This public housing program enables eligible lower-income individuals and families to access affordable, safe, decent housing.
HUD seismic assessments are required for properties in seismic zones 3 and 4. If you are looking to get a HUD loan application approved, either for HUD Multifamily Construction Loans or HUD Multifamily Loans, you will need to obtain a seismic assessment by a qualified, registered engineer. The engineer will review the property in order to ensure that it is compliant with ASCE regulations.
About HUD Seismic Assessments
Seismic assessments, also known as seismic reports, analyze the seismic risk (probability of an earthquake) of a particular property. This includes the property’s proximity to faults, the expected possible strength, the type of construction, and more. They can include Probable Maximum Loss (PML) calculations and Scenario Expected Loss (SML) calculations, utilizing projections based on current building codes.
These assessments estimate the risk of structural damage and life-safety hazards in worst-case scenarios, such as expected casualties, economic losses including the cost to restore the building to pre-earthquake condition, and more.
How Are Seismic Reports Used In Real Estate Financing?
Seismic reports are used by lenders in order to assess the seismic risk of a property, so that they can make more informed decisions about loans, such as the amount of the loan they are willing to provide and the terms of the loan, such as interest rates and repayment terms.
If seismic assessments are not obtained, then the lender may not be able to accurately assess the risk of damage a property faces. This can result in higher interest rates and other such unfavorable terms for the borrower.
The Different Tiers Of HUD Seismic Assessments
HUD seismic assessments involve 3 tiers: initial screening, evaluation, and detailed evaluation.
- Initial Screening. This includes a site survey and analysis of data to determine ASCE 31 compliance.
- Evaluation. If issues are found during the first stage, this tier addresses them.
- Detailed Evaluation. If the issues present are serious, they may require more detailed evaluation.
Depending on the risk profile of the property assessed in the report, it may not need to go beyond the first or second tiers.
What Do Primary HUD Seismic Assessments Consist Of?
When you hire a registered engineer to conduct your HUD seismic assessment, they will do the following:
- Conduct seismic hazard analysis of the building, such as lateral force design and applicable code requirements for seismic standards
- Examine the structure for resistance to lateral forces, continuity, and ductility.
- Gauge structural elements and connections between elements to determine if the structure provides ¾ seismic force level resistance.
How Long Do HUD Seismic Assessments Take?
The timeline of the seismic report depends on project-specific factors, such as complexity and the number of tiers required to be completed. Tier 1 evaluations may take a few days for smaller sites, and up to two weeks for larger sites. For “benchmark” buildings (that is generally buildings constructed later than late 1990’s), VIE has found that seismic retrofit is very rarely needed. Also, many 1980s to early 1990’s buildings may also conform to HUD requirements. If buildings conform to Tier 1 requirements, no further evaluation is needed.
For older buildings, possible seismic concerns may be identified based on Tier 1 findings. In these cases, Tier 2 evaluations may be performed in an additional one to two weeks or so. Tier 2 evaluations are used to further refine Tier 1 evaluations and determine if buildings do or do not need seismic retrofitting to conform to HUD requirements. It is important to carefully perform Tier 2 analyses such that overly conservative assumptions do not lead to unnecessary retrofit recommendations.
If indicated to be needed from Tier 2 evaluations, Tier 3 evaluations can be performed. If needed, Tier 3 evaluations are used to define retrofit methods appropriate for a specific property. If indicated by Tier 3 analysis, VIE provides cost and schedule estimates for retrofit construction. Emphasis is placed on providing cost effective solutions in these cases.
Complete HUD Seismic Assessments With VIE
VIE has developed techniques for cost-effectively performing seismic risk analysis required for HUD projects. VIE does this in an efficient, thorough manner that addresses all of HUD’s concerns. VIE has done over 100 HUD projects in the past 3 years alone, and every project report has been approved by HUD with no questions or alterations needed. These projects can be completed in as quickly as a day, depending on project size and specifications.
VIE’s HUD projects have addressed projects ranging from historic buildings that are pre-seismic design, to 1960s, 70s, and 80s buildings where some sort of seismic work has been done, and modern buildings constructed of benchmark, steel, masonry, etc. These have been 1-2 stories up to multistory buildings. VIE has done HUD’s projects throughout the US in seismically active areas, such as Washington, Oregon, Utah, Idaho, California, and even in midwestern and eastern states.
If you’re looking for an engineer that can perform a HUD seismic risk analysis thoroughly and quickly, we are the people to talk to. Contact us today to learn more about our seismic engineering services and what we can do for you.