Freddie Mac Multifamily Loans
For Financing 5+ Unit Multifamily Properties
Freddie Mac Multifamily Loan Programs
Freddie Mac (FHLMC) is a government sponsored entity that provides fixed rate or floating rate loans to acquire or refinance all types of multifamily properties. These multifamily mortgages are used to finance properties such as market-rate apartments, student housing, senior housing, and affordable housing. While Freddie Mac's conventional loan program has always been an excellent source for large multifamily properties, the introduction of Freddie Mac SBL (small balance loan) program has opened the door for more investors to take advantage of Freddie Mac non-recourse loans.
For eligible borrowers, Freddie Mac multifamily loans offer some of the best terms and rates in the market, along with Fannie Mae. However, qualifying for Freddie Mac loans requires that the borrower and property both meet a high standard set by Freddie Mac.
$1 Million to $100 Million+
5 - 10 years Fixed, up to 20 years Floating
4.05% - 6.08% (8/7/2018)
- Low Rates (among the best in the market)
- Long Amortization (Up to 30 years)
- 80% LTV
- Experienced multifamily owner
- Stabilized, cash-flowing property
- 650+ credit score
- Sufficient net worth and liquidity
Required Documents for Underwriting
- Current rent roll
- Last 2 years operating statements
- Schedule of Real Estate Owned
- Personal Financial Statement (for Guarantors)
- Executive Summary
How to Get a Freddie Mac Multifamily Loan
Freddie Mac does not directly originate loans, but instead relies on authorized lenders to underwrite and service the loan based on Freddie Mac guidelines. While Freddie Mac offers loans in a wide variety for scenarios and geographies, each authorized lender may only originate for a limited number of loan programs in a limited geographic area. Your StackSource Capital Advisor can review your property to connect you with the right Freddie Mac originators in the StackSource lender network.
Guide to Freddie Mac Multifamily Loan Programs
Freddie Mac Conventional Loan Program
Freddie Mac's conventional multifamily loan program offers loans for market-rate multifamily properties for loan amounts larger than the SBL program. This program is commonly used by both individual and institutional investors to finance their multifamily assets because of the favorable rates and terms. These Freddie loans are an especially good fit for borrowers seeking to hold their asset over the long term.
Freddie Mac SBL (Small Balance Loan) Program
Freddie Mac's SBL program provides financing for loan amounts of $1 Million to $6 Million (Up to $7.5 Million in some markets). This program offers excellent terms to borrowers that qualify. Freddie SBL loans typically have a fixed rate period of 5 - 10 years, followed by a ARM (adjustable rate mortgage) for the duration of the loan.
Freddie Mac Affordable Housing Loan Program
This relatively new Freddie loan program is available for multifamily real estate in underserved areas that are affordable to families with low incomes. This program offers beneficial rates and terms on assets that qualify.
Freddie Mac Senior Housing Loan Program
Freddie Mac provides loans for acquisition or refinance of senior housing including properties for independent living, assisted living, or a limited amount of skilled nursing. The loan programs provide long term loans with up to 30 year terms. The maximum LTV varies based on terms from 60% up to 75%.
Learn More About Multifamily Loans
GSE stands for “Government Sponsored Entity”, and in this beginner’s guide we’re going to cover the two most important players, who you’ve sure to have heard of: Fannie Mae, and Freddie Mac.
So the Fed raised rates again, with more increases expected this and next year. So what? They are still at historical lows, and it’s not a bad time to put debt on a multifamily investment property.
Agency debt for multifamily properties is awesome. It’s non-recourse, offers long-term fixed rates, and features competitive rates. The agencies (Fannie Mae and Freddie Mac) don’t lend direct, but they both license a set of direct lenders to offer their products according to standardized underwriting, and then take the loans and securitize them on the back end.