HUD 221(d)(4) Loan for Multifamily Construction
HUD 221(d)(4) Requirements and Guidelines
For New Construction or Substantial Rehabilitation of Multifamily Properties
- Loan Sizes: $10,000,000 minimum, Unlimited Maximum
- Loan Modification Allowed to Lower Rate if Rates Come Down
- Mixed Use: 25% Commercial Space Allowed
- Loan to Cost: 85% Market Rents, 87% Affordable Rents, 90% Subsidized Rents
- Up to 3 years on Construction Loan
- 40-Year Fixed Rate on Permanent Loan at the same rate as the construction loan
- 40-Year Term and Amortization on Permanent Loan
- 1.176 DSCR - Market Rents,1.15 - Affordable Rents, 1.11 – Subsidized Rents
- Non-Recourse
- No Tax Returns
- No Debt to Income or Global Ratio for Borrower
- Assumable with a .50% fee
- Loan Fee: 1 – 2%
- HUD Approval Fee: .30%
- HUD Exam Fee: .40%
- Mortgage Insurance Monthly: .25% for Green, .60% for Standard Properties
- Replacement Reserves Required Monthly for Future Repairs and Replacements
- Current Multifamily Ownership Experience Required
- Current Multifamily Development Experience Required
- Any size Market Okay
- Good Credit Required
- No Minimum Net Worth Requirement
- >Declining Prepayment Penalty 1st 10 years
- Rate Lock at Loan Approval
- 9 – 10 Months for Closing
For more information please see HUD 221(d)(4) Loans