HUD lowered the mortgage insurance premium on every FHA multifamily program to 0.25%, the lowest level the law allows. Here is what changed and what it means for refinance, construction, and existing HUD loans.
HUD published a Federal Register notice in September 2025 setting both the upfront and annual mortgage insurance premium at 0.25% for all FHA multifamily insurance programs. The new rate applies to any application submitted or amended on or after October 1, 2025.
Before the change, premiums ranged from 0.25% to 0.95% depending on the program. A standard market-rate deal typically paid 0.65%, affordable housing paid 0.35%, and only projects that earned a green building certification reached 0.25%.
| Category | Before | Now |
|---|---|---|
| Standard market-rate | 0.65% | 0.25% |
| Affordable housing | 0.35% | 0.25% |
| Green certified | 0.25% | 0.25% |
Because every program now carries the same premium, HUD eliminated the separate green, affordable, and broadly affordable premium categories along with the green requirements attached to them, including annual energy reporting and the green regulatory rider.
A lower annual premium reduces debt service, which improves the coverage ratio and can increase loan proceeds on a stabilized property. As a simple example, on a $20 million loan, cutting the annual premium from 0.65% to 0.25% saves roughly $80,000 in the first year.
Developers no longer need to pay for green building certification and annual recertification to get the lowest premium. That removes a real cost and a compliance burden from new construction and substantial rehab projects.
Owners of green-certified properties who already had the 0.25% rate no longer need to maintain annual recertification. Owners of existing HUD loans at a higher premium should ask whether a 223(a)(7) refinance under the new schedule makes sense for their property.
With the 10-year Treasury near its highest level since 2007, every basis point of cost matters. A uniform 0.25% premium makes HUD's long-term, fixed-rate, non-recourse financing more competitive with agency and bank debt than it has been in years. We run HUD and agency sizing side by side at no cost. Request a sizing or read our Fall 2026 market update.