Fannie Mae Multifamily Structured ARM Financing

ARM Loans for Large Apartment Buildings and Multifamily Properties Insured by Fannie Mae

Multifamily investors looking to finance larger apartment buildings or multifamily developments with an adjustable-rate product may find that Fannie Mae’s ARM 7-4 and 7-6 fall a little short. In lieu of this, the Fannie Mae Structured ARM is the alternative to look into. With the Fannie Mae Structured ARM, the minimum loan amount is a whopping $25 million. Speaking to the program’s flexibility, the Structured ARM product has a minimum DSCR requirement of 1.00x at the maximum interest rate. Of course, these loans follow the Fannie Mae standard of being non-recourse and fully assumable (with lender approval and a 1% fee).

2021 Sample Fannie Mae Terms For Structured ARM Loans

Size: $25 million minimum loan amount

Terms: 5, 7, or 10 years

Amortization: Up to 30 years

Interest Rate: Based on the 1-month or 3-month LIBOR, both convertible and non-convertible options are available

Interest Rate Cap: No built-in caps, borrowers need to purchase an interest-rate cap from an approved provider. Initial interest rate caps must be at least 4 years, but, if the interest rate cap is smaller than the loan term, the borrower must put funds in escrow monthly for the next cap.

MaximumLTV: Up to 75%

MinimumDSCR: 1.00 (at max. interest rate)

Recourse: Loans are non-recourse with standard “bad boy” carve-outs

Prepayment Options: 1-year lockout, then a 1% prepayment premium or declining prepayment premium

Occupancy Requirements: 85% physical occupancy, 70% economic occupancy

Commercial Space Limits: Commercial space must be no more than 35% of the net rentable area and must produce no more than 20% of the property's income

Eligible Properties: Properties must be stabilized; can include market rate, affordable, student housing, military housing, seniors housing, and manufactured housing community properties


  • Competitive interest rates
  • Loans are non-recourse


  • Requires third-party reports including a property appraisal, property condition assessment, and a Phase I Environmental Assessment
  • Requires replacement reserves (minimum of $250/unit per year)
  • $12,500 application deposit and $3,000 processing fee required
  • 1% origination fee also required
  • Does not allow for supplemental financing before conversion to a fixed-rate loan
  • Only 30-day rate lock commitments are available