HUD 232 Basic Information 

The basic terms of the HUD 232 loan include: 

• Loan Purpose: Construction, acquisition, rehabilitation of properties intended for senior citizens

• Loan Size: $2 million minimum (average loan size is $7.6 million)

• Loan Term:

  • 10-year minimum, fully amortizing

  • Up to 40-year fixed-rate term for new and rehabilitated properties

  • Up to 35-year fixed-rate terms for non-rehab acquisitions that can be funded with Government National Mortgage Association (GNMA) mortgage-backed securities

• Skilled Nursing Facilities/Independent Living Units: 80% LTV (for profit), 85% LTV (nonprofit) 

• Assisted Living Facilities: 

  • New Construction: 75% LTV (for profit), 80% (nonprofit) 

  • Purchase: 80% LTV (for profit), 85% LTV (nonprofit) 

  • Substantial Rehabilitation: 80% LTV (for profit), 85% LTV (nonprofit) 

    • Or, 90% of HUD-eligible replacement costs (whichever is less)

    • For borrower-owned properties, 100% of the existing mortgage debt or 90% of the “as is” market value of the property before rehabilitation (95% for nonprofits)

    • For properties that will be bought and substantially rehabilitated, 85% of the purchase price of the property or 90% of the current market value of the property before rehabilitation (95% for nonprofits)

    • This also applies to skilled nursing facilities/independent living units 

• DSCR: 1.45x minimum DSCR, 1.11x minimum DSCR for HUD 232(i) fire safety loans

HUD 232/223(f) Basic Information

Projects that don't qualify for substantial rehabilitation or purchase under the HUD 232 loan program may qualify for the HUD 232/223(f) program. This financing is available for borrowers who want to either purchase or refinance a senior living asset. The terms of this loan product include:

• Loan Purpose: Purchase or refinancing of properties intended for senior citizens

• Loan Size: $2 million minimum (average loan size is $7.6 million)

• Loan Term: Minimum 10 years, maximum 35 years (or 75% of the remaining economic life of the property, whichever is less)

• Leverage:

  • Purchase:

    • Lesser of 85% of the acquisition price or appraised value (for-profits)

    • Lesser of 90% of the acquisition price or appraised value (nonprofits)

  • Refinance::

    • Lesser of 100% of the cost to refinance or 85% of appraised value (for-profits)

    • Lesser of 100% of the cost to refinance or 90% of appraised value (nonprofits)

• DSCR: 1.45x minimum DSCR

Tools for Brokers, Investors, and Developers 

If you're interested in HUD 232 or HUD 232/223(f) financing for a senior living development, we have the tools to help. Our information sections cover subjects including: 

• Frequently Asked Questions

• Appraisal Requirements

• Types of HUD 232 Loans (including refinancing and supplemental financing)

• Terms, Qualifications, and Guidelines for HUD 232 financing

In addition, we have also provided our easy-to-read HUD 232 and HUD 232/223(f) term sheets.

FOR DEVELOPERS

Find developer-specific information, including: 

• State Approval Information

• Healthcare Documents

• Insurance Requirements

• A Construction Application Submission Checklist for HUD 232 construction loans