HUD 232/223(a)(7) Healthcare streamlined refinance
Refinance an existing HUD-insured healthcare loan to improve its long-term financing structure.
Program at a glance
- Term
- At least 10 years; potential extension of up to 12 years, subject to original-loan limits.
- Interest
- Fixed for the loan term.
- Loan limits
- Original mortgage amount, eligible refinance costs and debt-service limits each apply.
- Debt coverage (DSCR)
- At least 1.11×, including mortgage insurance.
- Cash-out
- Not available.
- Recourse
- Nonrecourse, with standard carve-outs.
The lowest applicable sizing result sets the loan amount. Debt coverage compares underwritten income with loan payments, including mortgage insurance.
Documents & videos
Loan processing timeline
Pre-qualification & engagement
Review the existing FHA-insured healthcare loan, payoff terms and expected refinance benefit.
Refinance application preparation
Gather loan, facility and operator information for the streamlined refinance review.
Application submission & HUD review
Submit the refinance application and respond to HUD’s questions.
Firm commitment
If approved, review the new loan terms and conditions to satisfy before closing.
Rate lock & closing preparation
Coordinate the rate lock, payoff, legal documents and remaining closing requirements.
Close the refinance
Replace the existing FHA-insured healthcare mortgage with the new loan.
The schedule depends on the project and required reviews.
Common questions
What types of properties qualify for HUD healthcare financing?
Section 232 covers qualifying skilled nursing, assisted living and board-and-care facilities. Memory care may qualify within an eligible licensed facility. HUD reviews licensing, care services, bed count and the property’s operating history. Hospitals and outpatient clinics are not financed under Section 232.
How much healthcare experience does the team need?
HUD generally expects the borrower, operator and management agent’s principals to have at least three years of successful experience with multiple facilities offering the proposed types of care. Experience with only one facility requires a longer history. Three years is a starting point, not an automatic qualification. We also review each participant’s responsibilities, relevant market experience and, for construction, development and lease-up experience.
What should I send for an initial healthcare review?
Start with the facility’s location, licensed beds or units, care types, occupancy and recent operating statements. Include existing debt details and any planned purchase or repairs. For the team, send a list of facilities, locations, care types, bed counts, dates and each principal’s role. For construction, add the preliminary budget and development plan.