223(e) Declining Urban Areas

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Chapter 1
Appraisal & Property Requirements
Page 1-11

Purpose and General Information: HUD Handbook 4260.1 Miscellaneous Type Home Mortgage Insurance Section 223(a), (e), and (d), and HUD Handbook 4150.2 Section B-3) The purpose of Section 223(e) is to permit the use of FHA mortgage insurance in older, declining urban areas where there is a need for affordable housing. A mortgage may be insured pursuant to Section 223(e) for the repair, rehabilitation, construction, or purchase of properties in older, declining urban areas. Eligibility under Section 223(e) is to be determined by the appropriate HOC. (Please see: HUD Handbook 4000.2, Section 2-12.) For additional information on appraising and underwriting a 223(e) mortgage, see the references above. The ADP CODE for a 223(e) is 792.