HUD 232/223(a)(7) Refinancing

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

For current HUD 232 or HUD 232/223(f) borrowers looking to potentially reduce their interest rate, increase their loan's amortization, and improve their property's cash flow, the most attractive financing option is typically the HUD 232/223(a)(7) Refinancing Loan. Much like the HUD 223(a)(7) refinance, the process is incredibly streamlined, only requires one third-party report, and can close in as little as 60 days. Like many other forms of HUD multifamily financing programs, HUD 232/223(a)(7) refinance 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.

2021 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 the 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

MinimumDSCR: 1.11x for for-profits, 1.05x 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