Acquisition Loans
HUD 223(f) Acquisition Loans: Basic facts about HUD 223(f) financing for the acquisition of apartment buildings and multifamily properties.
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One of the main uses of HUD 223f loans is purchasing existing multifamily properties. Although these loans take longer to originate, they offer borrowers low interest, fixed-rate mortgages for as long as 35 years. When used for acquisition, FHA 223(f) loan parameters include:
Subsidized Properties: (including rental assisted and Section 202 properties)
Affordable Properties:
Maximum LTV/Acquisition Cost: 87%
Minimum DSCR: 1.15x
Maximum LTV/Acquisition Cost: 85%
Minimum DSCR: 1.18x
Despite these maximum limits, HUD 223(f) loans are still constrained by existing statutory per unit limits, and loans cannot exceed 100% of mortgageable transaction costs minus any portion of applicable public loans, grants, and tax credits.