FHA-insured refinancing for apartments and healthcare facilities
Section 223(f) and Section 232 offer something the conventional market does not: up to 35 years, fully amortizing, fixed, non-recourse and assumable, with no balloon and no refinance risk. This site explains how they actually work, with every figure cited to the mortgagee letter or handbook section that sets it.
At a glance
- 223(f) market rate
- 87% LTV · 1.15x
- 223(f) affordable
- 90% LTV · 1.11x
- Multifamily MIP
- 0.25% / 0.25%
- 232/223(f) healthcare
- 80% LTV · 1.45x
- 232/223(f) MIP
- 1.00% / 0.65%
- 232 cash-out
- Not permitted
- Maximum term
- 35 years
Sizing is always the lowest of several tests. See 223(f) and 232 for the full criteria.
The programs
Four executions, and they are not substitutes
Which one fits depends on what you are optimizing for, a lower payment, more proceeds, or funding capital work and whether the property is housing or healthcare.
Section 223(f)
The core apartment refinance. Up to 87% LTV and 1.15x coverage on market-rate deals, 90% and 1.11x on affordable and rental-assisted properties. Cash-out available to 80%. Repairs mortgageable up to the substantial rehabilitation threshold.
Program detail → Healthcare · refinance or acquisitionSection 232 & 232/223(f)
Skilled nursing, assisted living, board and care and memory care. 1.45x coverage, 80% leverage for-profit and 85% non-profit, two-year debt seasoning, and no cash-out under any circumstances. Processed under LEAN.
Program detail → Already FHA-insuredSection 223(a)(7)
The streamline. Fastest and cheapest route for a property that already carries insured debt, no appraisal typically required, lower application fee, term extended up to twelve years. No cash-out. Often the right answer for anyone who closed before October 2025.
Program detail → ChoosingWhich program fits?
A decision tree across 223(a)(7), 223(f), the 241(a) supplemental and 221(d)(4), organized by what you are trying to accomplish rather than by program number, including the cases where the honest answer is that FHA is the wrong tool.
Work through it →Side by side
Housing and healthcare are priced very differently
The two programs share a statute and almost nothing else. The gaps below are the reason applying apartment assumptions to a nursing facility goes wrong.
| Provision | 223(f) apartments | 232/223(f) healthcare |
|---|---|---|
| Minimum DSCR | 1.15x market · 1.11x affordable | 1.45x all project types |
| Maximum LTV | 87% market · 90% affordable | 80% for-profit · 85% non-profit |
| MIP upfront / annual | 0.25% / 0.25% | 1.00% / 0.65% |
| Cash-out | Permitted to 80% LTV | Prohibited entirely |
| Debt seasoning | No general requirement | Two years, narrow exceptions |
| Recently completed property | Eligible at 1.17x over 3 months | No comparable relief |
| Processing protocol | MAP (Handbook 4430.G) | LEAN (Handbook 4232.1) |
| Maximum term | 35 years, fully amortizing | 35 years, fully amortizing |
| Recourse | Non-recourse with carve-outs | Non-recourse with carve-outs |
| Assumable | Yes, 0.05% fee to HUD | Yes, operator review applies |
Each figure cites the mortgagee letter, Federal Register notice or handbook section that sets it. See primary sources.
Insights
Fine print, read closely
The provisions that quietly decide deals and the ones the rest of the industry is still publishing wrong.
Section 232 Did Not Get the 0.25% MIP Cut
HUD's September 2025 notice took multifamily MIP down to a uniform 25 basis points. The healthcare programs are absent from that table, and the difference is 40 basis points a year on every insured nursing and assisted living loan.
Read → 223(f) loan sizingMortgagee Letter 2025-03, Line by Line
The letter that moved market-rate 223(f) to 87% LTV and 1.15x coverage. What it changed, what it pointedly did not change, and the vacancy floors that travel with each tier.
Read → 232 cash-outSection 232 Forbids Cash-Out, Full Stop
A Section 232 refinance can lower the rate, lengthen the term and take the balloon off the table. What it cannot do is return equity to the owner. Here is the rule and what to do when liquidity is the goal.
Read → 223(f) eligibilityThe 223(f) Three-Year Rule Was Effectively Repealed in 2020
Sites across the industry still say a property must be three years old to qualify for a 223(f). HUD removed the mandatory wait in March 2020 and replaced it with a coverage test almost nobody publishes.
Read → Mortgage insurance premium‘Submitted or Amended On or After October 1, 2025’
The MIP notice's transition language is unusually generous, and it has a hard stop. Understanding both words decides whether a pending application pays 25 basis points or 60.
Read → 223(f) repairsThe 2026 Substantial Rehabilitation Threshold Is $20,406 Per Unit
Nearly every published figure in the industry is anchored to a base of $15,000 set a decade ago. The base indexes annually, and getting it wrong understates how much repair work a 223(f) can carry.
Read →Reference
Look it up, settle it, move on
Three reference tools we could not find done well anywhere else in this field.
HUD Loan Lookup
Every FHA-insured multifamily and healthcare loan endorsed in the last fifteen years, searchable by project, city, state and amount. HUD’s own figures.
Search the loans →Glossary
From aggregate cost to the vacancy floor, every term that has a governing citation carries it, so you can check the source rather than take our word for it.
Open the glossary →Questions & answers
The questions owners actually ask, grouped by subject, sizing, cash-out, premiums, repairs, process, and how to tell whether your information is current.
Read the Q&A →Have a specific property in mind?
Tell us what you are trying to accomplish
Tell us the property and the objective, and you will get the answer the guidance actually supports, including when that answer is that FHA is the wrong tool. No rates, no obligation.