HUD 221(d)(4) Loan - New Construction or Rehabilitation of Multifamily Properties
| Eligible Properties | Market Rate, Affordable, and Subsidized Multifamily |
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| Eligible Borrowers | Single-Asset, Special Purpose Entities (For-Profit or Non-Profit) |
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| Loan Amount | No Minimum/No Maximum (subject to General Loan Parameters) |
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| Location | Nationwide |
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| Term & Amortization | Interest-only term equal to actual construction period, plus 40 years fully amortizing |
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| General Loan Parameters |
For loan amounts up to $75 million:
(Subject to statutory mortgage limits)
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| Interest Rate | Fixed rate, subject to market conditions at the time of rate lock |
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| Recourse | None, except standard carve-outs |
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| Assumable | Yes, subject to HUD approval |
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| 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. |
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| Mortgage Insurance Premium | Depending on property type: |
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| 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. |
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| Other |
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