We were tasked with developing a multifamily financing strategy which would provide the multifamily construction financing along with a permanent multifamily mortgage loan for the Shoreham Apartments in the Eastex/Jensen area of Houston Texas. Because the developer was building the project as a multifamily affordable housing project, it was immediately clear that a traditional, market rate apartment loan would not have sufficed. Innovation in apartment lending was required.
We developed a multifamily financing package which combined various types non-recourse apartment loans that addressed the construction financing along with the economic needs of a property that would be operated at significantly below market rents. We examined all available GSE insured apartment loans and decided to combine a Fannie Mae multifamily affordable housing loan with Low Income Housing Tax Credits. The LIHTC Program provided the developer with publicly subsidized federal tax credits which significantly reduced the developer’s cost basis in the property.
We brought Fannie Mae into the deal to provide a $3,600,000 low-interest, 30 year, non-recourse multifamily FNMA affordable housing loan that blended perfectly with the Low Income Housing Tax Credits we were able to place. We clearly identified and arranged the optimal multifamily financing structure for the Shoreham Apartments.
FNMA Affordable Housing Loan Fact Sheet
|Project||Fannie Mae Multifamily Affordable Housing Loan with Low Income Housing Tax Credits|
|Property||Shoreham Apartments, Houston Texas|
|Location||Eastex/Jensen area, Houston Texas|
|Property Type||Multifamily Affordable Housing|
|Loan Type||Fannie Mae Multifamily|
|Loan Program||Fannie Mae DUS Multifamily Loan|
|Loan Terms||30 year self amortizing, low-interest apartment loan|
|Loan Amount||$3,600,000 Plus Tax Credits|
Fannie Mae Multifamily DUS
- Apartment loan minimum $750,000
- Preferred loan minimum $3,000,000
- No maximum loan amount
- 80% Loan to Value Ratio
- Self amortizing 30 year term
- Low, fixed interest rate
- 1.25x debt coverage ratio
- Non-recourse as to the borrower
- FNMA DUS Multifamily Details
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FNMA Affordable Housing Loan Houston
We placed a 30 year, fixed-rate, $3,600,000 FNMA affordable housing loan on the property in conjunction with LIHTC tax credits. The Shoreham Apartments are located in the Eastex/Jensen neighborhood of north Houston, Texas.
Median household income here ($26,270) is significantly lower than US average ($56,604). The population is racially diverse, younger, and mostly married couples. The average house value here ($76,300) is lower than in the Houston-Sugar Land-Baytown metro area as a whole. The median age here is 28. There are 24,198 men and 22,731 women. The median age for men is 27 while for women the median age is 28.
FNMA Affordable Housing Loan Location
More Info About Fannie Mae Apartment Loans
Fannie Mae multifamily loans provide liquidity, stability and affordability for apartment financing by serving the secondary mortgage market as a reliable source of multifamily mortgage capital. Some 85% of the apartments financed with Fannie Mae apartment loans are affordable to families earning at or below 100% of the area’s median income level. The vast majority of Fannie Mae multifamily loans are for workforce housing.
Fannie Mae provides financing to a wide spectrum of the multifamily housing market. Fannie Mae multifamily financing is available for market rate apartments, rent-restricted affordable housing, housing cooperatives, seniors housing projects, student housing and manufactured housing communities. Fannie Mae apartment loans are available for loans greater than $1 million ($750,000 for Fannie Mae Small Multifamily Loans) up to $1 billion structured transaction facility.
A network of Delegated Underwriting & Servicing (DUS) lenders originate Fannie Mae apartment loans using a shared risk model. The majority of Fannie Mae DUS multifamily loans are supported with private capital and 98% of the liquidity Fannie Mae delivers to the multifamily market is supported by private capital through the purchase of Fannie Mae mortgage backed securities by private investors.
View details about all of the Fannie Mae Loan Programs we offer.