HUD / FHA Financing

40-year fixed.
Non-recourse.
One loan.

HUD-insured financing offers terms that conventional lenders cannot match. For developers and owners who understand the tradeoffs, it is often the most powerful tool in multifamily finance. We run HUD deals every quarter across the Mountain West and know what it takes to close.

40
Year Fixed Rate
Whatever you lock today is the highest rate you will pay for the life of the loan.
85%
LTV on Refinance
Up to 85% LTV on stabilized assets with strong occupancy and NOI.
0%
Recourse
Full non-recourse from day one. No personal guarantees required at close.
1
Loan for Construction + Perm
221(d)(4) wraps construction and permanent financing into a single closing.
HUD 221(d)(4)
New construction and
substantial rehabilitation.

The 221(d)(4) program funds ground-up multifamily development and major rehabilitation projects. Construction financing and the permanent loan close simultaneously, eliminating refinance risk and locking in your long-term debt structure before a shovel hits the ground.

Loan Purpose New construction, substantial rehabilitation, adaptive reuse
Loan Term Up to 40 years, fully amortizing
Rate Structure Fixed for the full term
Recourse Non-recourse
Loan-to-Cost Up to ~80% LTC for market-rate; higher for affordable deals
Debt Coverage ~1.15x DCR for market-rate; 1.11x floor for affordable
MIP 0.25% per annum (flat, HUD-insured)
Prepayment Rate modification available at minimal cost if rates decline
Minimum Units 5 units or more
Markets Served Utah, Colorado, Nevada, Arizona, Idaho, and surrounding Mountain West

Best fit for

  • Ground-up apartment development, 100+ units at scale
  • Developers who want to lock rate before construction begins and eliminate lease-up refinance risk
  • Phased projects where Phase 1 stabilizes while Phase 2 breaks ground
  • Opportunity Zone projects seeking long-term fixed debt alongside equity tax benefits
  • Deals where a 40-year amortization meaningfully improves cash-on-cash return versus conventional construction debt

When 221(d)(4) wins the comparison

  • Rate certainty matters more than construction flexibility — no floating rate exposure during the build
  • Sponsor is equity-sensitive — HUD LTC often reduces required equity versus conventional
  • Long hold strategy — 40-year fixed debt aligns with generational ownership plans
  • Refinance risk is a concern — one closing eliminates the lease-up bridge-to-perm sequence
  • Project size justifies the process — the larger the deal, the better the economics of HUD execution
Get Started
Request a preliminary sizing

We size 221(d)(4) deals at no cost. Give us the project details and we'll come back with preliminary loan sizing, rate range, and an honest read on whether HUD makes sense for your deal.

Request Sizing Download Market Update
Current Rate Environment
HUD 221(d)(4) all-in rates track the 10-Year Treasury plus a MBS spread and 0.25% MIP. Our latest market update covers current rate ranges and what to expect at application versus rate lock.
View Current Rates
HUD 223(f)
Permanent financing for
stabilized multifamily.

The 223(f) program refinances or acquires existing stabilized multifamily properties. It is the primary HUD tool for owners looking to lock in long-term fixed-rate debt, extract equity, or replace floating-rate construction debt on a completed and occupied asset.

Loan Purpose Refinance or acquisition of stabilized, existing multifamily
Loan Term Up to 35 years, fully amortizing
Rate Structure Fixed for the full term
Recourse Non-recourse
Max LTV Up to 85% for market-rate; higher for affordable
Debt Coverage Underwritten to current NOI; ~80%+ occupancy as proceeds driver
MIP 0.25% per annum
Prepayment Rate modification at minimal cost if rates decline
Eligible Properties Multifamily rental, 5+ units, at least 3 years old
Markets Served Utah, Colorado, Nevada, Arizona, Idaho, and surrounding Mountain West

Best fit for

  • Owners replacing a maturing construction loan on a completed, occupied asset
  • Long-term holders replacing floating-rate or balloon debt with permanent fixed-rate financing
  • Sponsors looking to recapitalize equity out of a stabilized asset without a sale
  • Owners of existing portfolios in HUD-served markets with assets 85%+ occupied
  • Deals where a 35-year fixed term meaningfully outperforms a 10-year agency balloon on hold-period math

When 223(f) wins the comparison

  • Long hold horizon — 35-year fixed eliminates refinance risk and balloon exposure permanently
  • Rate asymmetry favors locking now — today's rate is the highest you'll pay; modification is inexpensive if rates fall
  • Proceeds matter — HUD regularly outperforms agency on loan sizing for qualifying assets
  • Balance sheet simplicity — no covenant compliance, no lender relationship management, no maturity cliff
  • Non-recourse is a priority — eliminates personal exposure from the capital stack
Get Started
Request a preliminary sizing

We size 223(f) refinances at no cost. Share the property details and current financials and we will come back with a preliminary loan amount, rate range, and a side-by-side vs. agency so you can see the spread.

Request Sizing Download Market Update
The Process
What actually happens,
start to finish.

Both programs run under HUD's Multifamily Accelerated Processing (MAP) Guide, but the workflows are materially different. 221(d)(4) is a development approval process. 223(f) is a credit and asset quality review. Here is how each one actually moves.

HUD 221(d)(4)
10-14 Months Typical
Phase 0
2-4 weeks
Feasibility & Lender Engagement
Sponsor selects a MAP-approved lender. Lender performs initial sizing: LTC, DSCR, and statutory cost limits. Site control, zoning, and utility feasibility reviewed. Go / no-go decision made before any fees are committed.
Phase 1
3-5 weeks
Concept Meeting (HUD Invitation Stage)
Lender submits a Concept Package to HUD — no third-party reports required at this stage. HUD reviews market viability, site acceptability, and sponsor and contractor experience. HUD either issues an Invitation to Submit Pre-Application or declines.
If HUD declines here, the deal stops. This is a real gate.
Phase 2 — Longest Phase
2.5-4 months
Pre-Application (Initial Underwriting)
Third-party reports ordered and compiled. HUD has 45 business days to review. Outcome: Approval, Approval with Conditions, or Rejection. If approved, HUD issues a Letter to Proceed (LTP).
Limited Appraisal Market Study Phase I ESA Survey Prelim. Arch. Drawings
Phase 3
3-4 months
Firm Application (Full Underwriting)
Full credit committee plus construction underwriting. HUD reviews cost reasonableness, architecture and construction compliance, contractor financials and bonding capacity, and environmental clearance.
Full Appraisal A&E Plans/Specs Cost Review Full Environmental Contractor Financials Bonding Capacity
Phase 4
2-4 weeks
Firm Commitment Issuance
HUD issues Firm Commitment. Interest rate locked via GNMA execution. Legal documents finalized. Closing conditions identified and tracked.
Phase 5
30-45 days after Firm
Initial Closing & Construction Begins
Construction loan and permanent loan close simultaneously. Funds disbursed through HUD-controlled draws. Construction period typically 18-36 months depending on project scope.
Phase 6
Post-completion
Final Endorsement / Permanent Loan
After completion, cost certification, and lease-up, the loan converts seamlessly to permanent financing. No separate closing, no refinance risk, no gap in the capital stack.
HUD 223(f)
6-9 Months Typical
Phase 0
1-2 weeks
Feasibility & Sizing
Initial sizing based on DSCR, LTV, and statutory per-unit limits. Property must meet basic eligibility: 85%+ occupancy, at least 3 years old, repair scope below HUD cap. Go / no-go before engaging third-party vendors.
Phase 1
30-45 days
Third-Party Reports
All reports ordered simultaneously — 223(f) has no Pre-Application stage. Unlike 221(d)(4), there is a single submission. Report quality and turnaround time is often the primary driver of overall timeline.
Appraisal Market Study Phase I ESA PCNA Survey
Phase 2
2-3 weeks
Firm Application Submission
Lender compiles and submits a single, complete Firm package to HUD. There is no concept meeting, no pre-application, and no Letter to Proceed. One submission, one review cycle.
Phase 3
45-90 days
HUD Review
HUD reviews income sustainability, repairs escrow, replacement reserves, and borrower credit and experience. Timeline varies by HUD field office workload. Outcome: Firm Commitment, Conditions, or Rejection (less common than 221(d)(4)).
Phase 4
30-45 days
Closing
Rate locked. Escrows funded. Loan closes and funds. No construction phase. Existing debt retired, new HUD-insured permanent debt in place from day one.
Key differences from 221(d)(4)
No concept meeting. No pre-application phase. No Letter to Proceed. Single submission to HUD. Delays on 223(f) typically come from repairs, valuation disputes, or occupancy — not HUD structural risk concerns. Experienced lenders on clean assets regularly close in 5-6 months.

What delays both programs

Environmental issues, market study challenges, inexperienced sponsors or operators, design changes mid-process (221(d)(4)), and HUD field office workload fluctuations are the primary sources of timeline variance. The fastest executions come from experienced teams with clean sites, strong third-party vendors, and no surprises in the reports.

How It Compares
HUD vs. conventional agency.
Factor HUD / FHA Fannie / Freddie Conventional Bank
Rate Type Fixed, full term Wins Fixed 10-year, balloon Floating or 5-7 yr fixed
Loan Term 35-40 years Wins 10 years 3-7 years
Amortization 35-40 years Wins 30 years 25-30 years
Recourse Non-recourse Wins Non-recourse (with carve-outs) Often full or partial recourse
Max LTV Up to 85% (refi) / ~80% LTC (construction) Up to 80% 65-75%
Rate Modification Available at minimal cost Wins Refinance required Refinance required
Construction + Perm Single close via 221(d)(4) Wins Two separate closings Two separate closings
Process Timeline 4-9 months typical 45-90 days Faster 30-60 days
Covenant Requirements HUD regulatory agreement only Simpler Ongoing lender covenants Full covenant package

Ready to see
what your deal qualifies for?

We run preliminary HUD sizing at no cost. No commitment required. Tell us what you have and what you are trying to accomplish and we will come back with numbers — HUD, agency, and bridge side by side — so you can make an informed decision before engaging a process.

Request a Sizing

To get started, we need the basics on your deal. Send us a note with what you have and we will take it from there.

  • Property address and unit count
  • Current NOI or projected rents (new construction)
  • Existing debt, if any
  • What you are trying to accomplish