HUD Programs

Affordable Housing

Construction or Rehabilitation

The HUD 221(d)(4) / 221(d)(3) / 220 program provides non-recourse construction and permanent financing for affordable housing properties, or substantial rehabilitation for existing affordable housing properties.

HUD defines Affordable Housing as projects that meet the following requirements:

  1. Rent and income restrictions must be imposed, monitored and enforced by a governmental agency for at least 15 years after construction, and
  2. Either
    1. a recorded Regulatory Agreement requiring the project to meet at least the minimum LIHTC restrictions of 20% of units at 50% of area median income (AMI), or 40% of units at 60% of AMI, with economic rents (i.e. the portion paid by the residents) on those units no greater than LIHTC rents, or
    2. a Project-Based Section 8 contract for 90% of the units.

Projects do not need to use LIHTCs to qualify for affordable underwriting so long as they meet the above requirements.

Market rate properties qualify for 85% LTV, 87% for Affordable, and 90% for projects that have 90% (or greater) of their units with rental assistance.

Typically, the HUD 221(d)(4) / 221(d)(3) / 220 program takes about 6 months to complete, and provides the best terms available for construction and rehabilitation projects. Under the program, borrowers can utilize a variety of credits to mitigate the equity requirement which could potentially increase the LTV to 90%+ for market rate properties.

A Developer's Fee is also available for non-profit borrowers, and age restriction is allowed (for 62 and older). Commercial space and income can be included in the loan assuming it meets HUD's limitations.


Creative Solutions

Bedford Lending is a nationwide leader in providing finance solutions for affordable housing projects throughout the United States. No project is too big, small, or complex. We have successfully worked on projects funded by, including, or requesting:

  • Section 202 Loans
  • Section 236 Loans
  • 9% & 4% Low Income Housing Tax Credits ( LIHTC )
  • New Market Tax Credits
  • Tax Exempt Bond Financing
  • Flex Subsidies
  • HAP Contracts
  • RAD Conversions
  • PBV / PBRA Vouchers
  • IRP Decouplings

Often times, we need to meld subordinated loans or grants with the programs to fill critical equity gaps. Our direct HUD programs can be used to fund capital improvements, replacement reserves and to add supportive services. In addition, we have extensive experience repositioning 236 properties that may need to be decoupled and/or maturing through either the Markup to Market or Markup to Budget programs.

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