HUD 232/223(a)(7) Refinancing

HUD-Insured Refinancing for Current HUD 232 or HUD 232/223(f) Borrowers

If you already own a senior living, assisted living, or skilled nursing facility that you built or purchased with a HUD 232 loan or a HUD 232/233(f) loan, but you want a lower interest rate or an extension on your loan term, you're in luck-- because the HUD 232/223(a)(7) refinancing program is designed for exactly that purpose. Like other forms of HUD multifamily financing, 232/223(a)(7) loans are fully assumable and non-recourse-- but, unlike other HUD multifamily loans, these loans require very little paperwork and only one third party report. 

Sample Terms For HUD 232/223(a)(7) Loans

Size:  Loans are allowed up to 100% of the "eligible transaction costs", which include the principal of the project's existing debt, prepayment penalties, funding for required replacement reserves, and a project capital needs assessment (PCNA)                              

Term:  The loan can increase by a period of up to 12 years, but new loan term may not exceed the original loan term: 40 years for HUD 232 loans and 35 years for HUD 232/223(f) loans                                                       

Amortization:  Up to 40 years, fully amortizing

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

MIP: HUD 232/223(a)(7) loans have an annual MIP of 0.55% of the entire loan amount, or 0.45% if the project is using low income housing tax credits (LIHTCs)


  • Allows term increase of up to 12 years 
  • Streamlined processing; loans can close in as few as 60 days 
  • Less paperwork and fewer reports required 
  • Loans are fully assumable (with FHA/HUD approval) 
  • HUD 232/223(a)(7) loans are non-recourse


  • The loan 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) fee and pay additional MIP each month