HUD 223f

DSCR: Debt Service Coverage Ratio in Relation to HUD 223(f) Loans

DSCR: Debt Service Coverage Ratio in Relation to HUD 223(f) Loans

Debt Service Coverage Ratio, or DSCR, is one of the most important metrics that lenders examine when determining whether to give a HUD 223f loan to a potential borrower. DSCR is designed to compare a property's annual cash flow and its annual debt service in order to assess the likelihood that a borrower will pay his or her debts on time, and avoid a mortgage default. 

What are the Pros and Cons of HUD 223f Loans?

What are the Pros and Cons of HUD 223f Loans?

HUD 223f loans have a variety of advantages and disadvantages for investors and developers. While they allow great amount of leverage, have low interest rates, and are non-recourse, they can also require somewhat lengthy wait times and a significant amount of documentation. In this easy-to-read FAQ, we'll go over some more of the pros and cons of HUD 223(f) loans. 

MIP: Mortgage Insurance Premiums in Relation to HUD 223f Loans

MIP: Mortgage Insurance Premiums in Relation to HUD 223f Loans

Before being approved for a HUD Multifamily loan, a borrower must have mortgage insurance. HUD-requires borrowers to pay MIP (Mortgage Insurance Premium) on FHA loans. This insurance policy is not to be confused with PIM (private mortgage insurance) which is required on some conventional mortgage loans.

RAD: Rental Assistance Demonstration in Relation to HUD 223f Loans

RAD: Rental Assistance Demonstration in Relation to HUD 223f Loans

The RAD (Rental Assistance Demonstration) Program gives PHAs (public housing authorities) the power to “preserve and improve public housing properties.” RAD also allows them to address the $26 billion dollar deferred maintenance backlog across nation.