HUD Eliminates Three-Year Rule on 223(f) Applications

Exciting news for value-add and new construction investors! On March 2, 2020, HUD announced the elimination of the three-year lock-out rule for applications to refinance or acquire existing properties under the Section 223(f) loan program.

This exciting change will open up opportunities for borrowers to refinance stabilized multifamily properties much sooner after construction completion and lease-up than previously available.

This primarily benefits those whose business model is to maximize leverage. Virtually all other loan programs – banks, Fannie Mae, Freddie Mac, […]


Commercial Loan Prepayment Penalties Unwrapped

Nothing says romance quite like a prenuptial agreement does it?

That comment is certainly facetious, but sets the stage for an analogy regarding the prepayment penalty aspect of commercial loans. It is important to understand what you’re getting into with your loan. The loan documents explain all the terms of the loan, and the prepay piece is really the predetermined cost of breaking up with a lender.

A prenuptial agreement defines and outlines what things will look like in the event […]

Multifamily Location Finger

Location and Loan Rates: A Critical Intersection in Multifamily Investing

Why Location, Location, Location Begs Repeating in Multifamily Investing

Location: a word so nice we say it thrice. The saying Location, location, location is oft repeated in real estate—for good reason. As the money managing site The Balance puts it, “You can buy the right home in the wrong location. You can change the structure, remodel it or alter the home’s layout but, ordinarily, you cannot move it. It’s attached to the land.”

When buying a single-family home, you may think […]


What Makes HUD Multifamily Refinancing Attractive

For both multifamily mortgage loans and private-sector financing, loans backed by the US government are some of the most ironclad and reputable out there. Some of the best examples of these, especially for multifamily investors, are HUD FHA loans for refinancing situations.

These acronyms represent the US Department of Housing and Urban Development (HUD) and its mortgage insurance arm, the Federal Housing Administration (FHA). At Bonneville Multifamily Capital, we have been granted the rare certification as a MAP (Multifamily Accelerated […]


How Does The MIP Work For HUD Multifamily FHA Loans?

MIP (Mortgage Insurance Premium) is a unique aspect of HUD/FHA insured multifamily loans. The reason it exists is to support the federal program that underwrites and ultimately guarantees FHA multifamily loans that offer the richest terms in the industry.

MIP is a monthly payment based on the outstanding balance of the loan at the beginning of each year. The year isn’t based on the calendar, rather every 12 months during the life of the loan. The MIP on the 223(f) […]

commercial building

Understanding the 2 kinds of MIP in FHA Commercial Mortgages

If you have ever financed a residential property with an FHA loan, you know what the PMI is. If not, PMI stands for (Private Mortgage Insurance). Like most insurance policies, PMI has a monthly premium that is collected by the insurer. Mortgage insurance assures the lender (investor) will be repaid the money the lend out.

FHA loans are backed by the full faith and credit of the federal government. However, FHA is not the lender; they are the insurer. Because […]

Miami Real Estate

Understanding BSPRA on an FHA 221(d)(4) Loan

Raising equity in any real estate deal is a hurdle that must be successfully navigated to find success. Equity investors make many real estate deals possible when the equity requirements exceed the sponsors capabilities or risk tolerances. Conversely, increasing leverage means using less “raised equity” so the sponsor retains more profit and ownership.

Accessing the highest leverage percentages in the industry is very attractive to developers, because they want to preserve cash for their next project. This is usually one […]

HUD Lending

What to Look for in a HUD Multifamily Lender

Every experienced multifamily investor knows that most commercial mortgages run for a 10-year term with a balloon payment due at maturity.  This sets the stage for needing multiple refinance transactions throughout the life of the loan until the property can be paid off, while continuing to generate maximum cash flow.  The cost and amount of effort to refinance every decade can be a significant use of resources over the life of the mortgage.

Look at recent history, and put yourself […]


What Are HUD FHA 223(f) Mortgage Loans?

HUD FHA 223(f) can be your ticket to ride and become an important financial tool in your efforts involving acquisition or refinancing of multifamily developments valued at $1 million and above.

Although you may be familiar with the Department of Housing and Urban Development (HUD), did you know that the Federal Housing Administration (FHA) provides loans designed for multifamily property owners?

HUD 223(f) Loan Basics

The short of it is, with this loan type, borrowers have the ability to get maximum leverage […]


February 2016 Changes to HUD MAP Guide

One of the principals of our firm recently spent some time with a new director at HUD. It was very interesting to get an insiders perspective of the changes and improvements going on within HUD that will make access to their amazing multifamily loans much easier.

This is great news for multifamily investors looking to eliminate refi risk and take advantage of the incredible interest rates in today’s marketplace. A new MAP guide was released this February and here is […]