HUD 221(d)(4) Program - Construction or Rehabilitation of Multifamily Properties
| Property Types | 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) |
||||||||||||||||||
| Location | Nationwide |
||||||||||||||||||
| Term & Amortization | Interest-only term equal to actual construction period plus 40 years fully amortizing |
||||||||||||||||||
| Loan Parameters |
For loan amounts up to $75 million:
(Subject to statutory mortgage limits)
|
||||||||||||||||||
| Interest Rate | Fixed rate, subject to market conditions at the time of rate lock |
||||||||||||||||||
| Recourse | None, except standard carve-outs |
||||||||||||||||||
| Assumable | Yes, subject to HUD approval |
||||||||||||||||||
| Prepayment | 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. |
||||||||||||||||||
| Mortgage Insurance Premium | Depending on property type: |
||||||||||||||||||
| 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 claim history is clean. |
||||||||||||||||||
| Other |
|