---
kind: "section"
citation: "24 C.F.R. § 245.417"
title: "24"
number: "245.417"
heading: "Initial submission of materials to HUD: Conversion of residential units to a nonresidential use, or to cooperative housing or condominiums."
url: "https://uscodex.org/cfr/24/245.417"
---

# §245.417. Initial submission of materials to HUD: Conversion of residential units to a nonresidential use, or to cooperative housing or condominiums.


In the case of a conversion of residential units to a nonresidential use, or to cooperative housing or condominiums, the mortgagor must submit the following materials to the local HUD office in accordance with §§ [245.415](/cfr/24/245.415.md) and [245.419](/cfr/24/245.419.md):

- (a) **In the case of a proposed conversion of residential rental units to nonresidential use—**
  - (1) A statement describing the proposed conversion;
  - (2) A statement describing the estimated effect of the proposed conversion on the value of the project, the project rent schedule, the number of dwelling units in the project, a list of the units to be converted and their occupancy, the amount of subsidy available to the project, and the project income and expenses (including property taxes);
  - (3) A statement assessing the compatibility of the proposed nonresidential use with the residential character of the project;
  - (4) Written approval of the mortgagee if required;
  - (5) An undertaking by the mortgagor to pay all relocation costs that may be required by HUD for tenants required to vacate the project because of the conversion; and
  - (6) **A copy of the notice to tenants.**
- (b) In the case of a proposed transfer of the project to a cooperative housing mortgagor corporation or association (conversion of residential rental units to residential cooperative housing), the materials specified in paragraphs [(a)(1)](#a-1), [(a)(2)](#a-2) and [(a)(3)](#a-3) of this section and the following additional materials:
  - (1) An estimate of the demand for cooperative housing, including an estimate of the number of present tenants interested in purchasing cooperative housing;
  - (2) Estimates of downpayments and monthly carrying charges that will be required; and
  - (3) Copies of proposed organizational documents, including By-Laws, Articles of Incorporation, Subscription Agreement, Occupancy Agreement, and Sale Document.
- (c) In the case of a proposed conversion of residential rental units to condominium units, the materials specified in paragraphs [(a)(1)](#a-1), [(a)(4)](#a-4), and [(a)(6)](#a-6) of this section and the following additional materials:
  - (1) An estimate of the demand for condominium housing, including an estimate of the number of present tenants interested in purchasing units;
  - (2) Estimates of downpayments, monthly mortgage payments and condominium association fees that will be required; and
  - (3) **A list of the units to be converted and their occupancy.**

## Notes

### Source

Source: 61 FR 57962, Nov. 8, 1996, unless otherwise noted.

### Authority

Authority: 12 U.S.C. 1715z-1b; 42 U.S.C. 3535(d).