HUD, or the U.S. Department of Housing and Urban Development, was set up by President Lyndon Johnson in 1965 as part of his "Great Society" program. It is part of the Executive Cabinet. HUD’s purpose is to develop and execute housing policies, specifically concerning affordability and sustainability. To do this, HUD offers a variety of mortgage insurance products for both singe-family homes, multifamily properties, and healthcare facilities.

These include FHA 203(b) loans and FHA 203(k) loans for single-family properties, HUD 221(d)(4) and HUD 223(f) loans for multifamily properties, HUD 232 loans for senior healthcare facilities, and the HUD 223(a)(7) multifamily refinancing loan program, which is the main focus of this website.

The purpose of HUD is to develop and execute housing policies, specifically concerning affordability and sustainability. To do this, HUD offers a variety of mortgage insurance products for both single-family homes, multifamily properties, and healthcare facilities. These include FHA 203(b) loans and FHA 203(k) loans for single-family properties, HUD 221(d)(4) and HUD 223(f) loans for multifamily properties, HUD 232 loans for senior healthcare facilities, and the HUD 223(a)(7) multifamily refinancing loan program. This information is sourced from hud223a7.loan/glossary/what-is-hud and commercialrealestate.loans/commercial-real-estate-glossary/what-is-hud.

The U.S. Department of Housing and Urban Development (HUD) is a department of the executive branch of the U.S. government tasked with improving the accessibility of housing for all Americans. HUD provides loan insurance for single family homes and apartment properties with up to four units through the Federal Housing Administration (FHA). HUD also insures mortgages under the HUD 232 and 242 loan programs. The HUD 232 loan program allows for the construction and significant rehabilitation of assisted living, skilled nursing, and memory care properties for senior citizens. The HUD 242 loan program is designed for financing hospitals, including acute care facilities, critical access hospitals, large urban teaching hospitals, and both non-profit, for-profit, and government-owned hospital facilities. For more information, please visit HUD's website.

In order to be eligible for HUD programs, a project must meet certain criteria. For HUD 223(a)(7) financing, the project must be located in the United States. For HUD 232/223(f) financing, the project must house 20 or more residents, provide ongoing medical care for long-term patients, be licensed by the appropriate municipal or state organization/agency, have been constructed least three years ago, have no more than 20% of the project's gross area or gross income devoted to/derived from non-resident day care, have no more than 25% of all units designated as independent living units, and have no more than 20% of the gross floor space filled and no more than 20% of the property's income derived from commercial tenants.

For more information, please visit HUD 223(a)(7) Terms, Qualification & Guidelines and HUD 232/223(f) Loans.

The HUD Section 8 program provides a variety of benefits for apartment loan investors. The primary benefit is that landlords can expect a regular payment from the U.S. government for each and every month that their unit is rented. Additionally, landlords can access a verified waiting list of Section 8 tenants in their area, and they don't need to worry about marketing expenses since there is usually a long waitlist for Section 8. Lastly, landlords don't need to make large capital investments in upgrading the property’s aesthetic nature since the Section 8 program brings tenants to the property.

For more information, please see the following sources:

• HUD Section 8
• The HUD Section 8 Program: A Guide for Apartment Loan Investors

You can apply for HUD programs by submitting an application once a Notice of Funding Availability (NOFA) is posted on the Grants.gov website. For FHA/HUD 221(d)(4) loans, you'll need to submit a transmittal letter, an Application for Multifamily Housing Project (Form HUD-92013) with a fee of $3 per $1000 of mortgage, and pass an intergovernmental review. Additionally, you'll need to fill out Byrd Amendment paperwork and submit Form HUD-92013 to disclose any recent legal actions regarding parties involved in the project. To check out the full list of documents you'll need to apply for an FHA/HUD 221(d)(4) loan, visit our FHA/HUD 221(d)(4) loan checklist.