Fannie Mae Supplemental Financing

Supplemental Loans for multifamily investors insured by Fannie Mae

In the world of multifamily finance, it isn’t uncommon for an investor to require an additional sum of money on top of a standard funding amount. Fortunately, the Fannie Mae Supplemental Loan is specifically designed to provide additional financing for Fannie Mae multifamily borrowers who want extra funding for their development. Starting at a minimum of $500,000, these loans offer a maximum LTV of up to 75% and fixed-rate terms of between 5 and 30 years.

Fannie Mae Supplemental Loans offer competitive interest rates and are mainly non-recourse. Plus, non-recourse Supplemental Loans are fully assumable (with lender approval and a 1% fee). Borrowers don't even have to wait long before applying, as they’re eligible for supplemental funding in as little as 12 months after the closing of their original Fannie Mae multifamily loan.

Sample Fannie Mae Terms For Multifamily Supplemental Loans

Size: $500,000 minimum

Terms: 5-30 year fixed-rate loan terms available, may or may not be coterminous with original Fannie Mae mortgage

Amortization: Up to 30 years

MaximumLTV: 75% (may vary based on how proceeds are used)

MinimumDSCR: 1.30x (may be more under certain conditions)

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

Prepayment Options: Yield maintenance or defeasance

Eligible Properties:

  • Conventional multifamily properties, Multifamily Affordable Housing (MAH), seniors housing properties, and student housing developments with existing Fannie Mae loans
  • Bond Credit Enhancement transactions are permitted with Fannie Mae approval

Timing: Loans typically close between 45 and 60 days after initial application


  • Competitive interest rates
  • Allows the borrower to access the equity in their property without refinancing
  • Streamlined documentation/underwriting process
  • Most loans are non-recourse
  • 30- 180 day rate locks available after commitment (streamlined rate locks also available)
  • Loans are fully assumable with lender approval and a 1% fee


  • Requires third-party reports including an Appraisal, a Property Condition Assessment, and a Phase I Environmental Update. A Seismic Report may also be required if the property is located in Seismic Zones 3 or 4.
  • Typically requires $10,000 in lender fees (including third-party reports, though this may vary by lender)
  • Often requires between $8,000 and $12,000 in legal fees
  • Requires a $20,500 application deposit
  • Requires a 1% approval fee (for non-recourse loans)
  • Not available for Fannie Mae loans with remaining loan terms of less than 5 years
  • 2% deposit typically required at rate lock (refunded after Fannie Mae purchases the loan, usually around 30 days after closing)