Loan Process

The following steps, which are part of the Healthcare Loan Program (HeLP) process may vary in specific order of events, but each step must be accomplished in order to complete the HeLP loan process. Each step listed may have several components to it, but for simplicity, only the most significant activity is listed. The contact people for the HeLP program are: Gary Henriksen at the Michigan Health and Hospital Association Service Corporation (MHA) (517) 323-3443 and John Barton at the Michigan State Hospital Finance Authority (MSHFA) (517) 335-0994. The steps directly involving the borrower are printed in bold type.

1. Borrower submits Healthcare Loan Program application to the MHA.

2. Borrower’s Board of Trustees passes a Resolution of Intent to Reimburse in order to preserve borrowers ability to pay for items which will be reimbursed from a later bond issuance. Sample Resolutions are available from MHA or on this website.

3. MHA reviews and send a copy of the loan application to the Michigan State Hospital Finance Authority (MSHFA) and to Fifth-Third Bank.

4. MHA reviews and sends list of items to be financed to the Michigan Department of Community Health for Certificate of Need waiver determination.

5. MSHFA Board authorizes the borrower’s financing.

6. Fifth-Third Bank contacts the borrower to set up a meeting to discuss the loan request, and obtain information needed for the issuance of a loan commitment proposal. The bank issues individual commitments to each borrower as part of the overall program Letter of Credit.

7. Fifth-Third Bank issues a loan commitment proposal to the borrower.

8. Borrower signs and returns loan commitment proposal to Fifth-Third Bank.

9. MSHFA prepares and publishes legal (TEFRA) notice of project description to be included in bond issuance.

10. MSHFA Board members approve the issuance of bonds.

11. Fifth-Third Bank, MSHFA and the borrower establish a loan closing date.

12. Attorney for Fifth-Third Bank sends the bank legal documents to the borrower, and MSHFA send the Loan Agreement, Note, Loan Closing Memorandum (checklist), Fact Sheet and Request for Payment Form to the borrower.

13. Borrower signs and returns loan documents, and the borrower’s Board of Trustees passes Resolution of Corporate Board and borrowers legal counsel prepares the Opinion Letter of Borrowers Counsel. A sample Board Resolution and Opinion Letter of Counsel are included in the Loan Closing Memorandum.

14. After the loan closing, the borrower submits Request for Loan Proceeds to MSHFA.

15. MSHFA issues check or wire transfers loan proceeds to the borrower.