HUD Loans

HUD offers various loan programs, based on your need and portfolio type.

Find Your Loan

FHA (Federal Housing Authority) and HUD (Housing and Urban Development) refer to government loan programs that provide insurance for multifamily mortgages. FHA / HUD loan programs can be used for existing properties, new construction, or rehabilitation. HUD approved lenders can offer long term loans (up to 35 years) with the best rates in the market because the lenders are insured by the FHA against loss on mortgage defaults.
FHA / HUD loans are the often the best mortgage option for multifamily housing because it is a long term permanent debt option, but can be readily paid off at any time with a simple tax deductible prepayment penalty or fully assumed by a new property owner after a simple 0.05% one-time fee. These features can lead to a premium price in the event of a sale because the buyer has the option to either pay off the loan or assume the existing debt with a below market interest rate.

The HUD lending program applicable for more than just Section 8 and affordable housing. Class A, market-rate multifamily properties across the country can qualify for a FHA loan. HUD non-recourse loans can also be combined with local tax credits or municipal grants to create a compelling investment scenario.

Your HUD Options

HUD Program

223(F)

Properties containing five or more rental units and have been completed or substantially rehabilitated for at least three years prior to the date of application for mortgage insurance.

35-year fixed term or up to 75% of the building’s remaining economic life (lessor of)

  • Non-recourse loan
  • Assumable if approved by HUD and lender
  • Fully amortizing loan

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HUD Program

232/223 (F)

Nursing homes, assisted living facilities, intermediate care facilities, board and care homes.

  • The facility must have been completed or substantially rehabilitated at least three years prior to the date of the Firm Commitment application.
  • Single asset and single purpose entity, for either non-profit or for-profit purposes.

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HUD Program

241(A)

Provides secondary financing for improvements or additions to properties with a HUD-first mortgage which need repairs, substantial rehabilitation or additional units.

  • Non-recourse loan
  • Assumable if approved by HUD and lender

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HUD Program

232

New construction or substantial rehab: nursing homes, assisted living facilities, intermediate care facilities, board and care homes.

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HUD Program

221(D)(4) & 220

Ground up construction and substantial rehabilitation of multifamily properties.

  • Eligible properties containing five or more rental units with no more than 25% of the net rentable area dedicated to commercial use and income not more than 15%-30% of EGI.

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HUD Program

231

Non-recourse, assumable construction and permanent financing for new age-restricted apartments or substantial rehabilitation of existing age-restricted apartments.

  • Housing for persons age 62 and older and handicapped persons Non-recourse
  • Assumable if approved by HUD and lender
  • Fully amortizing loan

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HUD Program

223(A)(7)

Refinance existing FHA insured multifamily and healthcare properties to reduce the interest rate and provide for minor repairs as required.

  • Expedited processing time
  • No third-party reports required other than property condition needs assessment
  • Non-recourse loan
  • Assumable if approved by HUD and lender
  • Risk share, 202 HUD Direct and co-insurance loans are ineligible

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