Affordable Housing

223(f) Acquisition / Refinance

Our direct HUD 223(f) program provides high-leverage, non-recourse financing for the acquisition or refinance of multifamily properties nationwide. 

Program terms include:

• 35 year fixed rate
• Fully amortizing
• Non-recourse 
• 87-90% LTV (80% LTV for cash-out refinances)
• 1.11-1.15x DCR
• No affordable units required, can be 100% market rate or blended
• Can be combined with Historic Tax Credits, LIHTC, Grants, etc.

Bedford Lending specializes in helping borrowers (including non-profits and Housing Authorities) who may have little to no familiarity with HUD financing successfully recapitalize and preserve their affordable properties. 

Typically, the underwriting timing of the 223(f) program takes about 5-6 months from start to finish.

Affordable projects qualify for minimum 90% LTV financing (80% LTV for cash-out refinances), which can be blended with grants and other equity sources (such as AHP) to meet or exceed 100% financing. For RAD/Section 18 conversions, the timing of the public housing conversion process aligns with the HUD 223(f) program, and HUD will subordinate to the RAD use agreement.

Projects do not need to use tax credits or have a HAP contract to qualify as "affordable housing" (please see HUD's definitions of affordability on the right side of this page).

Please note, while the 223(f) program can be used for both acquisitions and refinances, acquisition scenarios may be challenging due to timing (many sellers do not want to wait 4-6 months to close), and if you acquire a property with HUD, improve the bottom line, and then refinance with HUD at a later date to recapitalize yourself, you will be subject to the initial HUD acquisition loan's prepayment penalty (10-9-8-7-6-5-4-3-2-1 over the first 10 years) at time of refinance.