HUD/FHA Multifamily Documentation

If you want to apply for HUD multifamily financing, having the correct forms and documents is an essential part of the process. Both lenders and HUD want detailed information on both potential borrowers and the property itself. In order to help you close faster, we’ve provided a basic list of standard templates and forms available for download below.

Forms and Templates for Borrowers

Click to Download a PFS (Personal Financial Statement) Template
A personal financial statement, or PFS, allows a lender and HUD to determine the financial strength of the person (or persons) borrowing funds. In general, HUD would like to see borrowers with a net worth of at least 100% of the loan amount (not including retirement accounts) and a minimum of 10% of the loan amount in liquidity. If a deal has compensating factors, such as lower leverage, or a borrower with significant HUD multifamily experience, these requirements may be negotiable.

Click to Download an SREO (Schedule of Real Estate Owned) Template
If a potential borrower currently owns other investment properties, a Schedule of Real Estate Owned, or SREO, is a required supplement to a borrower’s PFS. In essence, if a borrower is already invested in real estate, HUD (and the lender) want to see how they’re managing their portfolio. They will also want to identify any potential liabilities or risks that may be associated with their current investments.

Click to Download an Organizational Chart
An organizational chart, or “org chart” demonstrates the exact structure of the borrowing entity. This can be extremely important for HUD, as projects can get complicated, particularly if multiple investors, trusts, or other unique capital structures are involved.

Property Financial Forms/Templates

In addition to learning more about the individuals behind the borrowing entity, HUD and lenders want to know about the profitability and financial status of the property itself. An operating statement, also known as a P&L, or Profit and Loss Statement, is one of the most effective ways to demonstrate this. A P&L shows both income and expenses and can be utilized to determine NOI (net operating income), DSCR (debt service coverage ratio), and other important metrics.

For greatest efficiency and transparency, a P&L can be organized as a Trailing 12 Month, Month-by-Month P&L or the "T-12" for which a template is available by clicking here. This breaks down a property’s profit and loss on a monthly basis for each of the last 12 months prior to the current month.

However, a 12-month operating statement typically isn’t enough to demonstrate a property’s historical profitability. In addition to a T-12, HUD and lenders will also want to see a Last 3 Years Operating Statements and Stabilized Budget (or 12-Month Pro Forma), for which a template is available by clicking here. A last 3 years P&L should typically demonstrate a breakdown of a property’s income and expenses year-by-year for prior 36 months of operations. A stabilized budget for the next 12 months is also included. A stabilized budget is important for all properties, but is particularly important for properties undergoing any kind of change, such as substantial rehabilitation or a change in property management companies. Click here to see our specialized Budget and Pro Forma for HUD 221(d)(4) construction and substantial rehabilitation loans.

Click to Download a Rent Roll Template
A rent roll is another one of the most important documents for a prospective HUD multifamily borrower. A rent roll lists all of a property’s tenants, including information such as the amount of rent they are paying, if they are current or behind on rent, any rental concessions that have been offered, as well as lease start and end dates. This information is extremely valuable for the underwriting process, as it can help lenders and HUD assess risk in ways that a T-12 or a last 3 years P&L cannot. For instance, if multiple tenants are behind on rent, or many of a property’s leases expire on the same date, it would generally suggest that the property may be an unreasonable risk.

Finally, another type of essential document is a sources and uses statement, which demonstrates where the funding for a multifamily or commercial real estate project is coming from and how each dollar of capital is used. In a sources and uses statement, the combined uses of funds must exactly match the combined sources of funds.