HUD Multifamily Loans
HUD multifamily loan programs offer low-rate, fully amortizing, fully-assumable, non-recourse financing for construction, substantial rehabilitation, acquisition, and property refinancing. Options include HUD 221d4 loans, HUD 223f loans, and HUD 232 loans.
HUD Multifamily and Healthcare Financing Options
The HUD 223(a)(7) loan program is specifically designed to refinance HUD multifamily and healthcare loans for existing borrowers. The most common types of loans refinanced with the HUD 223(a)(7) program include:
HUD 221(d)(4) loans: Designed for the new construction and substantial rehabilitation of multifamily properties
HUD 223(f) loans: Intended for multifamily property acquisition and refinancing
HUD 232 loans: Allow for the construction and substantial rehabilitation of senior living/healthcare facilities
HUD 232/223(f) loans: Intended for the acquisition and refinancing of senior living/healthcare facilities
Terms: 40 years (plus 3 year interest-only construction loan term)
Size: $2 million+
DSCR/LTV:
1.20x/85% for market-rate properties
1.15x/87% for affordable housing properties
1.11x/90% for rental assistance properties
Rates: HUD 221(d)(4) loans offer fixed interest rates only
Recourse: These loans are fully non-recourse with standard bad-boy carve-outs
Mortgage Insurance/MIP:
0.65% for market-rate properties
0.45% for Section 8/LIHTC properties
0.25% for projects with Green MIP Reduction
Term: 35 years
Size: $1 million+ (exceptions allowed on an individual basis)
DSCR/LTV:
1.18x/85% for market-rate properties
1.15x/87% for affordable housing properties
1.11x/90% for rental assistance properties
Interest Rates: Fixed
Recourse: Loans under HUD section 223(f) are fully non-recourse (standard bad boy carve-outs typically apply)
Mortgage Insurance/MIP:
MIP:
0.60% for market-rate properties
0.45% for Section 8/LIHTC properties
0.25% for projects with Green MIP Reduction
Term: 10-year minimum, 40-year maximum, up to 35 years for non-rehab acquisitions funded with GNMA Mortgage Backed Securities. All loans fully amortizing.
Size: Minimum loan amount is $2 million
LTV: 75%- 85%, depending on property type and whether entity is for-profit or non-profit
DSCR: 1.45x minimum
Rates: Loans under the HUD section 232 program are fixed-rate
Recourse: These loans are fully non-recourse (though standard bad boy carve-outs typically apply)
Mortgage Insurance: 1% MIP charge due at closing, followed by 0.65% annual MIP assessment
Term: 10-year minimum, 35-year maximum (or 75% of the remaining economic life of the property, whichever is less)
Size: Minimum loan amount is $2 million
LTV: 85-90% of the acquisition price or appraised value for purchases, 100% of the cost to refinance or 85-90% of appraised value for refinances
DSCR: 1.45x minimum
Below, we’ll go over the basic terms of each of these HUD multifamily loans to help you better understand the different financing options available on today’s market.
HUD 221(d)(4) Financing
The HUD 221(d)(4) loan program finances the construction and substantial renovation of properties with 5+ units. This can include traditional apartment buildings, mixed-use properties with a limited amount of commercial space, and even independent living projects for seniors. Keep reading below to learn more, or click here to download our easy-to-understand HUD 221(d)(4) loan term sheet.
HUD 221(D)(4) Loan Terms
HUD 221(d)(4) program terms include:
HUD 223(f) Financing
The HUD 223(f) program finances the acquisition and refinancing of eligible multifamily projects. Just like HUD 221(d)(4) loans, HUD 223(f) loans are designed to allow borrowers to acquire and refinance multifamily properties. Just like HUD 221(d)(4) loans, these loans can be used for apartment buildings, eligible mixed-used properties, and independent living facilities for senior citizens. Keep reading below to learn more, or click here to download our easy-to-understand HUD 223(f) loan term sheet.
HUD 223(f) Loan Terms
HUD 223(f) program terms include:
HUD 232 Healthcare Loans
With a HUD 232 loan, you can build or substantially renovate healthcare properties for seniors, including nursing homes, assisted living facilities, and memory care centers. Keep reading below to learn more, or simply click here to download our easy-to-read HUD 232 loan term sheet.
HUD 232 Loan Terms:
HUD 232/223(f) Healthcare Financing
With a HUD 232/223(f) loan, you can refinance or acquire a variety of healthcare properties for senior citizens. Just like with HUD 232 loans, these may include assisted living centers, nursing homes, or memory care facilities. Keep reading below to learn more, or simply click here to download our easy-to-read HUD 232/223(f) loan term sheet.