HUD 223f Loans for Property Acquisition
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:
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.