ACQUISITION AND REFINANCE LOANS FOR
EXISTING MULTIFAMILY APARTMENTS
FHA SECTION 223(f)

Minor repairs and replacements, while not a requirement for eligibility, are allowed and are payable from mortgage proceeds. However, such repairs cannot exceed 15% of HUD's final estimate of value after repairs (or) $6,500 times the applicable high cost factor on a per unit basis. Additionally, no more than one major building system may be replaced, i.e., roofs, HVAC systems, windows, etc. Appliances and life-safety systems and equipment are exempt from these limits.

Commercial space is allowable, however, commercial income can not exceed 20% of the total effective gross project income, or 20% of the net rentable area.

Nationwide

$up to $100,000,000

• Up to 35 year term
• Up to 85% loan-to-value ratio
• Minimum debt service coverage 1.18% (85% of NOI)
• Fully amortizing
• Fully assumable
• Low, fixed interest rates
• Non-recourse
• No Rent Control Restrictions
• No Limitations on owner's return
• Mortgage proceeds may be used to pay for acquisition or refinancing costs, including the cost of repairs, financing costs, and initial deposit to replacement reserve.

 

Cash out is permitted on refinance transactions where 80% of value exceeds existing debt and transaction costs.

Secondary financing is permitted by HUD, however, the aggregate amount of the insured first mortgage and the second mortgage cannot exceed 92.5% of HUD's established Fair Market Value of the project.

Negotiable. Typically ranging from a five-year lockout to a ten-year lockout, with or without a declining prepayment penalty in the five years beyond the lockout period of 5%, 4%, 3%, 2%, 1%, 0% . The note interest rate will be adjusted according to the selected lockout/prepayment terms.