September 26, 2022

HUD 223(f) 80% Cash Out Refinancing Program Picks Up Steam as Property Values Increase

Multifamily property values

Multifamily property values across the nation are increasing in response to macroeconomic factors and aftershocks caused by the COVID-19 pandemic. As a result, property owners are incentivized to take advantage of the HUD 223(f) refinance program given its unique cash out feature. A cash out allows borrowers to take out up to 80% of their property’s appraised value in cash through a 223(f) refinance. This cash out feature is superior given that it is determined by loan-to-value (LTV), as opposed to loan-to-cost (LTC), which does not take appreciation into account. Furthermore, a 223(f) refinance allows current property owners to significantly increase the leverage on their property and take full advantage of any appreciation their asset has likely sustained in the currently inflated housing market.

Beyond cash out, a 223(f) refinance has markedly favorable terms with a fixed rate, fully-amortizing, fully assumable, non-recourse HUD-insured mortgage loan that boasts a market-rate minimum DSCR of only 1.176. In the world of cash out refinancing, look no further than the HUD 223(f) program. For more information on the 223(f), visit our term sheets or contact us as