Environmental Reviews for HUD 223(a)(7) Loans

If a project does not involve new construction, rehabilitation, or any physical impacts (except for routine maintenance), HUD does not require an environmental review for Section 223(a)(7) refinancing. Below are examples of routine maintenance and physical impacts.

  • Routine maintenance: cleaning, caulking, fixing gutters, replacing broken glass, and replacement of non-fixture appliances.

  • Physical impacts: activities such as replacing windows, doors, or fixtures.

NOTE: Projects involving new construction, rehabilitation, or physical impacts are not eligible for HUD 223(a)(7) refinancing thus preventing the need for environmental reviews.
However, if the property to be refinanced sits in a special flood hazard area (based upon the most recent Flood Hazard Map), the borrowers must “obtain and maintain Flood Insurance coverage for the duration of the mortgage.”