A HUD-Held loan is an FHA-insured loan that is now owned by HUD. This typically occurs when a borrower has defaulted on their loan and HUD decides to purchase the loan from the lender. In some cases, HUD will provide debt service relief to the property for a certain period of time, while creating a work-out plan to stabilize the property financially.

In relation to FHA 232 Financing, a HUD-held property is a property with an FHA-insured loan that is now owned by HUD. This can allow the borrower to gain certain benefits. In contrast, a HUD-owned property is one in which the title has been given to HUD, usually as the result of a foreclosure.

The benefits of a HUD-Held loan include debt service relief, which HUD may provide to the property for a certain period of time, while creating a work-out plan to stabilize the property financially. This can allow the borrower to gain certain benefits. In contrast, a HUD-owned property is one in which the title has been given to HUD, usually as the result of a foreclosure. For more information, please see HUD's Debt Service Relief Program.

The requirements for a HUD-Held loan depend on the type of loan. Generally, HUD-Held loans are FHA-insured loans that have been foreclosed on and the title has been transferred to HUD. HUD may provide debt service relief to the property for a certain period of time, while creating a work-out plan to stabilize the property financially. For more information, please refer to HUD's Debt Service Relief Program.

For more information about HUD multifamily construction loans like the HUD 221(d)(4) loan, please fill out the form and a HUD lending expert will get in touch.

In general, HUD-Held loans close 60 days from application submission. HUD has an estimated 45-day review period for multifamily properties and an estimated 60 days for healthcare properties. However, each case is different and in some instances, it could take as long as 3 months to close. A typical timeline might be as follows:

• Firm application is typically submitted to HUD within 30 days.
• After HUD issues the firm commitment and rate lock, most HUD-Held loans close in 45 to 60 days.

For HUD 221(d)(4) loans, one-stage applications for affordable and rental assistance properties generally take 5 - 7 months to close, whereas two-stage applications for market-rate properties generally close in 8 - 12 months, subject to deal specifics.

The risks associated with a HUD-Held loan include the potential for the borrower to default on the loan, resulting in HUD taking ownership of the loan. Additionally, HUD may provide debt service relief to the property for a certain period of time, while creating a work-out plan to stabilize the property financially. This could result in the borrower having to pay additional fees or interest. For more information, please see HUD's Debt Service Relief Program.

The alternatives to a HUD-Held loan are other FHA-insured loan programs, such as the HUD 221(d)(4) loan program. The HUD 221(d)(4) loan program is a multifamily construction loan that provides long-term, fixed-rate, non-recourse financing for the acquisition, new construction, or substantial rehabilitation of multifamily properties. To learn more about HUD multifamily construction loans like the HUD 221(d)(4) loan, click here.