FHA/HUD section 223(F)
Multifamily and Mixed-Use cash-outs, refinance and acquisition
- 3.75%+ Fixed (our fee built into interest rate)
- 1% mortgage insurance premium at closing then 0.6% annually on decreasing loan amount
- Term: 35 years fully amortizing
- $5 to $100 Million+
- No upfront fees. We are paid when your loan is funded at closing.
- Eligible properties: market rate properties of any class, cooperatives, affordable or subsidized housing. Construction or substantial rehab completed 3+ years before application to HUD; student housing allowable but cash flows cannot assume multiple rents from one unit and rents must be in line with market rate multifamily comparables.
- Subsidized: (at least 90% Section 8): 87% LTV, 1.11X DSCR, 90% acquisition to cost & 80% cash-out
- Affordable: (with minimum set-aside 15+ years): 90% LTV, 1.15X DSCR, 87% acquisition to cost & 80% cash-out
- Market Rate: 85% LTV, 1.18X DSCR, 85% acquisition to cost & 80% cash-out
- Repair and rehab limitations: up to $15,000 times local cost factor (190% to 270%); repairs not 50%+ of two building systems; electrical, plumbing, mechanical, building envelope and structural
- Commercial space limited to 25% of net rentable area & 20% of gross income
- 0.5% rate lock deposit refunded at closing
- Low fees and points
- Prepayment and assumption negotiable
- Occupancy requirement: 85% average occupancy for the past 6 months (steady or trending up); for projects within 3 years of construction/major rehab completion: no occupancy requirement; for example if 70% occupancy supports loan amount requested; start underwriting 2 months prior but loan takes 6+ months to close
- 700+ Credit
- Strong borrower/sponsor liquidity, net worth, financials and experience
- Single asset, special purpose LLC, for profit or non-profit
- Escrows: taxes, insurance and mortgaage insurance premiums escrowed monthly; capital needs reserve maintained with monthly deposits to HUD guidelines (minimum $250/year)Mortgage insurance premium: due to HUD at closing 1% and 0.6% annually thereafter; 0.25% to 0.35% for affordable and subsidized properties; 0.25% for Energy Star Certified properties.
- HUD application fee: 0.30% of estimated loan amount due with application
- Third party reports: appraisal, environmental & capital needs assessment
- Timeline: typical application submitted 45 to 60 days of engagement; 60-90 days to HUD commitment and 30-45 days to closin
- To submit your online loan request, please click the blue GET STARTED Link for your PRE APPROVAL Term Sheet within 48 business hours. No tax returns, income verification, upfront fees, credit cards, Social Security Numbers or credit checks are required for PRE-APPROVAL.