HUD 223(f) Loan - Acquisition or Refinance of Multifamily Properties

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Eligible Properties

Market Rate, Affordable, and Subsidized Multifamily

Eligible Borrowers

Single-asset, special purpose entities, either for-profit or non-profit.



Loan Amount

No Minimum/No Maximum (subject to General Loan Parameters)

General Loan Parameters

The maximum loan is the lesser of:

  • 83.3% (85% for Affordable) Loan To Value
  • 1.20x Debt Service Coverage
  • 80% Loan to Value if cash out
For loan amounts up to $75 million:
Property TypeMax LTVMin DSCAcq LTCIf Cash Out
Subsidized 90% 1.11x 90% 80% LTV
Affordable 87% 1.15x 87%
Market Rate 85% 1.18x 85%
(Subject to statutory mortgage limits)
Interest Rate

Fixed rate, subject to market conditions at the time of rate lock

Term & Amortization

Up to 35 years and fully amortizing



Mortgage Insurance Premium

Depending on property type:
.25% to 1.0% at Closing
.25% to 0.60% Annually


Yes, subject to HUD approval


Typically loans are prohibited from prepayment for the 1st year, then have a 9% penalty declining 1% each year thereafter until 0%.  Alternative lockout and prepayment structures are available.

Professional Liability Insurance

HUD requires a minimum coverage of $1 million per occurrence and $3 million aggregate.  Waivers may be granted in cases where premiums are high and claims history is clean.

  • Properties must average physical occupancy levels of 85% for 6 months prior to submission, and maintain that level through loan closing
  • Escrows required for repairs, mortgage insurance premium, taxes, insurance, and replacement reserves
  • Third party reports include Appraisal, PCNA, and Phase I
  • Secondary financing is allowed, subject to HUD guidelines and approval