HUD Multifamily Construction Financing
HUD 221(d)(4) loans allow for the construction or substantial rehabilitation of multifamily and apartment properties. HUD multifamily loans for construction are non-recourse and offer up to 90% LTV for eligible properties.
Better Financing Starts with More Options$1.2M offered by a Bank at 6.0%$2M offered by an Agency at 5.6%$1M offered by a Credit Union at 5.1%Click Here to Get Quotes- HUD Multifamily Construction Loans
- Features of the HUD 221(D)(4) Multifamily Construction Loan
- HUD 221(d)(4) Loan Eligibility and Requirements
- Fees and Other HUD 221(d)(4) Information
- To learn more about HUD 221(d)(4) loans for multifamily construction and rehabilitation, fill out the form below and a HUD loan expert will get in touch.
- Get Financing
HUD Multifamily Construction Loans
Right now, the HUD 221(d)(4) loan is the only HUD-insured loan designed for ground-up construction of market-rate multifamily residential properties in the United States. Due to its incredibly attractive terms, the loan has become increasingly popular among developers. In many cases, the HUD 221(d)(4) program lets them save money and increases the long-term financial stability of their multifamily development projects.
Keep reading to learn more, or click here to download our easy-to-understand HUD 221(d)(4) term sheet.
Features of the HUD 221(D)(4) Multifamily Construction Loan
HUD 221(d)(4) loans have:
40-year loan terms (+3 year interest only construction loan period, 43 years overall)
Available for ground-up construction and substantial rehabilitation of properties with 5+ units
A minimum loan amount of $4 million, no maximum loan amount (but subject to statutory limits)
Highly competitive interest rates
Non-recourse financing
HUD 221(d)(4) Loan Eligibility and Requirements
In addition to some of the requirements mentioned above, HUD 221(d)(4) borrowers must:
Have a maximum LTV of:
85% for market-rate properties
87% for affordable properties
90% for properties with 90% or more low-income units
Have a bonded, licensed, and insured general contractor execute a GMP contract
Fees and Other HUD 221(d)(4) Information
Developers should also understand that HUD 221(d)(4) loans:
Have a mortgage insurance premium (MIP) of:
0.65% for market rate developments
0.45% for new money LIHTC properties
0.70% for Section 220 and certain LIHTC renewal projects
0.25% for properties that qualify for a Green MIP reduction
Have a HUD Application Fee of 0.3%
Have a HUD Inspection Fee of 0.5%
Require borrowers to pay for 3rd party reports, including:
To learn more about HUD 221(d)(4) loans for multifamily construction and rehabilitation, fill out the form below and a HUD loan expert will get in touch.
- HUD Multifamily Construction Loans
- Features of the HUD 221(D)(4) Multifamily Construction Loan
- HUD 221(d)(4) Loan Eligibility and Requirements
- Fees and Other HUD 221(d)(4) Information
- To learn more about HUD 221(d)(4) loans for multifamily construction and rehabilitation, fill out the form below and a HUD loan expert will get in touch.
- Get Financing