HUD 223(a)(7) Refinancing Loans

HUD 223(a)(7) Loans for Refinancing Current HUD Multifamily Debt

For investors and developers who already have a HUD multifamily loan, a HUD 223(a)(7) loan is often the best way to refinance it. HUD 223(a)(7) refinances are designed to reduce interest rates, increase amortization, and ultimately, improve cash flow for properties, reducing the risk of a default. Unlike other HUD multifamily loans, which typically require significant paperwork, applying for a HUD 223(a)(7) refinance is relatively hassle-free, and these loans can close in as little as 60 days. Plus, HUD 223(a)(7) loans usually require only one third-party report, a project capital needs assessment (PCNA), in comparison to the several usually required to apply for a HUD 223(f) or HUD 221(d)(4) loan

Sample Terms For HUD 223(a)(7) Loans

Size:  Loans permitted up to 100% of "eligible transaction costs", including the existing debt principal, replacement reserves, prepayment penalties, and a project capital needs assessment (PCNA)                               

Term:  Loan can increase by a period of 12 years, but new loan term cannot exceed the original loan term: 40 years for HUD 221(d)(4) and HUD 232 loans and 35 years for HUD 223(f) and HUD 232/223(f) loans

Amortization:  Up to 40 years, fully amortizing

Minimum DSCR:  1.11x for for-profits, 1.05x for non-profits 

MIP: Mortgage insurance premiums for HUD 223(a)(7) loans are 0.55% of the loan amount per year, or 0.45% if the property is utilizing low income housing tax credits (LIHTCs).


  • Allows term increase of up to 12 years

  • Fast processing; closing can occur in as little as 60 days

  • Loans are fully assumable (with FHA/HUD approval)

  • HUD 223(a)(7) loans are non-recourse


  • Still requires one third-party report, a project capital needs assessment (PCNA)

  • Requires an FHA application fee of 0.30% of the loan amount

  • Requires borrowers to pay both an initial, one-time MIP (mortgage insurance premium) and pay MIP each month