- Apartment Acquisition Loans
- Apartment Construction Loans
- Apartment Refinancing Loans
- Apartment Rehab Loans
- Apartment Construction Loans FHA 221d4
- FHA 223f Apartment Loans
- FHA 223a7 Streamlined Refinance
- Fannie Mae DUS Multifamily Loans
- Fannie Mae Fixed Rate Apartment Loans
- Fannie Mae Structured Adjustable Rate Apartment Loans
- Fannie Mae Adjustable Rate Apartment Loans
- Fannie Mae Small Multifamily Loans
- Freddie Mac Fixed Rate Apartment Loans
- Freddie Mac Adjustable Rate Apartment Loans
- Freddie Mac Float To Fixed Multifamily Loans
Fannie Mae DUS Multifamily Loans
Fannie Mae DUS Multifamily Loans are critical to the functioning of the apartment lending market, providing a reliable source of mortgage capital. Created in 1988 to be a backstop to multifamily mortgage markets, Fannie Mae DUS Multifamily Loans are an essentially uninterruptible source of capital to the multifamily industry. Fannie Mae DUS Multifamily Loans are available to a wide spectrum of the multifamily lending market, including conventional apartment loans, rent-restricted affordable housing loans, cooperative housing loans, seniors housing loans, student housing loans and manufactured housing community loans.
The majority of Fannie Mae DUS multifamily loans finance workforce housing and more than 85% of the loans finance units that are affordable to families earning at or below the area’s median income level.
Since its creation in 1988, Fannie Mae DUS multifamily loans have delivered more than $300 billion in liquidity to mortgage markets, providing multifamily financing to more than 6.3 million apartment units. It is now the largest single source of apartment financing in America. Fannie Mae DUS multifamily loans provide industry low interest rates, flexible loan terms and certainty of execution for apartment loans with a $3 million minimum loan amount.
Offering flexible loan terms and industry low multifamily loan rates, Fannie Mae DUS Multifamily Loans may be used by credit-worthy single-asset US entities and entities with all US ownership to finance existing, stabilized properties with a minimum of five units or 50 pad sites in the case of Manufactured Housing Communities.
Fannie Mae DUS multifamily loans were created in 1988 to provide multifamily financing to meet the needs of developers and owners of multifamily projects seeking short- and long-term, fixed-rate, non-recourse financing. Fannie Mae instituted an underwriting and processing license arrangement with private mortgage brokers who would take “top end” risk on mortgage loans for the opportunity to underwrite and close loans without the pre-permission of Fannie Mae. This structure allowed Fannie Mae to build an engaged network of professional apartment lenders who would originate, process, underwrite, commit and close multifamily mortgage loans under the Fannie Mae guarantee of principal and interest repayment to the mortgage investment market.
While Fannie Mae is a GSE (Government Sponsored Enterprise) and not part of the federal government; it’s mortgage securities were (and continue to be) deemed virtually a “Full Faith and Credit” of the federal government. Thus, borrowers of Fannie Mae DUS multifamily loans receive an interest rate which is only slightly higher than those provided by FHA multifamily loans. Additionally, one of the key features of the all Fannie Mae DUS multifamily programs is that the borrower’s contact is with the DUS apartment lender, not with a government agency. Underwriting and processing times tend to be relatively fast and unless a special waiver is needed for a particular element of a transaction, the entire process is very straightforward.
All Fannie Mae DUS multifamily loans are a tremendous deal in the marketplace, offering borrowers better rates and terms than conventional multifamily loans, CMBS apartment loans or apartment bridge loans. We encourage you to get a better feel for Fannie Mae DUS multifamily loans and we are pleased to offer an exclusive property analysis and loan quote. There is, of course, no obligation, and it only takes a few minutes. Just send us the Loan Information Request and we’ll take care of the rest. You’ll also see how we’ll make your next deal more successful.
Fannie Mae DUS Multifamily Loans Video
Fannie Mae DUS Multifamily Term Sheet
Properties Eligible For Fannie Mae DUS Multifamily Loans
Existing income-producing multifamily properties with at least three stable months of 90% occupancy or better. Properties can be newly constructed or recently rehabilitated.
Amortization and Loan Terms
25 or 30 years depending on property’s age with balloon terms of 5,7,10, 15, 18 years or full term loans of 20, 25, or 30 years
Minimum Loan Size
Minimum programmatic loan size is $1,000,000 but preferred minimum is $3,000,000
Fannie Mae DUS multifamily loans are non-recourse as to the borrower for monetary default with typical carve-outs
For-profit individuals and entities as well as not-for-profit single asset entities
All Fannie Mae DUS multifamily loans are subject to a prepayment penalty calculated using either a yield maintenance or defeasance formula for all but the last six months of the term of the loan. These terms can be modified by adjusting the interest rate.
Maximum Loan Refinancing
The Lesser of:
- The amount supported by using a 1.25 to 1.00 debt service ratio.
- 80.0% of appraised value
Market interest rates change daily. View our Interest Rates and Capital Markets page here.
All All Fannie Mae DUS multifamily loans are assumable and transferable to a new owner at anytime for a 1.00% fee
Required for property taxes, insurance, and replacement reserves as calculated by the underwriter
125% to 150% of the estimated cost of repairs per the physical needs report. Funds released upon completion.
No third party subordinate financing, however Fannie Mae Supplemental Loans are allowed beginning 12 months after the initial first mortgage loan closing
Preliminary Submission Package
- Location map and property description and photos (or website info)
- Unit mix showing type, number, size, and current rent of all units
- Description of commercial space if any
- Last three months rent rolls along with year-to-date financial statements
- Last full 36 month operating statements or pro-forma if recently completed construction
- Business resume and financial statement of principals and entity
- Terms of existing debt if any