NOTE 7 – Mortgage Notes Payable

The mortgage loans from discontinued operations are payable in aggregate monthly installments of approximately $8,000 including principal and interest with rates varying from 1% to 8.13% per annum and have maturity dates ranging from 2026 through 2046. The remaining subsidiary partnership’s mortgage note payable is collateralized by the land and buildings of the subsidiary partnership, subject to performance under Housing Assistance Contract Number 96-493-204 and without further recourse to the Partnership. Deed of trust is held by the Washington State Department of the Community and by Washington State Community Reinvestment Association.

Accrued interest from discontinued operations amounted to approximately $57,000 and $63,220 as of March 31, 2017 and 2016, respectively. Interest accrues on all mortgage loans, which include primary and secondary loans. Certain secondary loans have provisions such that interest is accrued but not payable until a future date. The Partnership anticipates the payment of accrued interest on the secondary loans (which make up the majority of the accrued interest payable amount and which have been accumulating since the Partnership’s investment in the respective Local Partnership) will be made from future refinancings or sales proceeds of the respective Local Partnership or through assumption by the buyer upon sale of the Partnership’s interest in the remaining Local Partnership. In addition, the remaining Local Partnership’s mortgage notes are collateralized by the land and buildings of such Local Partnership, and are without further recourse to the Partnership.

The mortgage agreements generally require monthly deposits to replacement reserves. Monthly deposits of approximately $1,000 from discontinued operations were made to escrow accounts for real estate taxes, hazard and mortgage insurance and other expenses.

Annual principal payments on the permanent debt requirements for mortgage notes payable from discontinued operations for each of the next five calendar years and thereafter are as follows:


Years Ending December 31,	Amount

2017	$	46,647
2018		49,784
2019		53,179
2020		56,852
2021		61,872
Thereafter		1,276,032
		1,544,366
Less unamortized debt issuance costs		(17,290)

	$	1,527,076