Freddie Mac Fixed-rate Multifamily Loans

Fixed-rate Multifamily Loans for Conventional Apartment Buildings and Multifamily Developments

Freddie Mac fixed-rate conventional loans are a solid financing option with a wide variety of potential uses. Offering apartment financing in amounts between $5 million and $100 million, these loans allow for the acquisition or refinancing of conventional properties, student housing developments, seniors housing projects, cooperative apartments, and Targeted Affordable Housing (TAH) developments.

In addition, FRMC fixed-rate loans offer loan-to-value (LTV) ratio allowances of up to 80%, are non-recourse, assumable (with approval and fees), and offer flexible terms and amortizations of up to 30 years, making them suitable for a variety of different multifamily financing situations. Freddie Mac fixed-rate conventional loan borrowers will usually receive a commitment within 45 to 60 days after the initial application, which also makes them quite a bit speedier in execution than most of the competition.

2021 Sample Freddie Mac Terms for Fixed-rate Conventional Loans

Size: $5 million to $100 million (although the lender can approve smaller or larger amounts if necessary)

Use: Acquisition or refinance

Terms: 5 to 10 years (up to 30 years if the loan is not purchased for securitization)

Amortization: Up to 30 years with interest-only payment options

Maximum LTV/Minimum Debt-service Coverage Ratio (DSCR):

  • 5- to 7-year Loans:
    • Amortizing: 75%/1.30x
    • Partial Term Interest-Only: 75%/1.30x
    • Full Term Interest-Only: 65%/1.40x
  • 7-year Loans:
    • Amortizing: 80%/1.25x
    • Partial-term Interest-only: 80%/1.25x
    • Full-term Interest-only: 70%/1.30x
  • 7-plus Year Loans:
    • Amortizing: 80%/1.25x
    • Partial-term Interest-Only: 80%/1.25x
    • Full-term Interest-Only: 70%1.35x

Recourse: Nonrecourse with standard “bad boy” carve-outs

Prepayment Options: Yield maintenance until securitization, 2-year lockout period following securitization, and defeasance allowed after securitization; Yield maintenance for securitized loans is permitted for an additional fee; no prepayment premiums required in the last 90 days of the loan

Eligible Borrowers:

  • Eligible borrowers include limited partnerships, limited liability companies, corporations, or tenancies in common (TICs) with 10 or fewer members
  • In some circumstances (and with specific requirements), general partnerships, real estate investment trusts (REITs), limited liability partnerships (LLPs), and some trusts may also be eligible
  • Typically, borrowers must be single-purpose entities (SPEs); however, on loans of less than $5 million, borrowers may be able to be single asset entities (SAEs) instead
  • For TICs, each member needs to be an SPE

Eligible Properties: Conventional multifamily properties, manufactured housing communities, seniors housing developments, cooperative housing, student housing developments, and targeted affordable housing, including Low-Income Housing Tax Credit (LIHTC) Year 4-10 and 11-15 and Section 8 properties

Refinancing Test: No test needed for amortizing loans with a DSCR of at least 1.40x and an LTV of less than or equal to 65%; interest-only loans must pass a refinancing test before they are approved

Assumability: Loans are assumable with lender approval and require a 1% assumption fee. May also require an underwriting fee paid to the lender (typically $5,000)

Timing: Borrower will typically receive a commitment 45 to 60 days after initial application; third-party report timing and borrower due diligence submission may speed up or slow down the process


  • Very competitive interest rates
  • Up to 80% LTV for some properties
  • Loans are nonrecourse
  • Supplemental loans allowed
  • Mezzanine financing available
  • Early rate-lock options allowed, between 60 and 120 days before purchase, index locks are also available to eligible borrowers
  • Eligible mixed-use properties permitted


  • Requires replacement reserves
  • Requires third-party reports including Phase I Environmental Site Assessment, Appraisal, and Physical Needs Assessment; Seismic Report may be required for properties in Seismic Zones 3 and 4
  • Application fees required: $2,000 or 0.1% of the loan amount (whichever is larger) for conventional first mortgages, $5,000 or 0.15% of the loan amount ― whichever is larger ― for seniors housing, $3,000 or 0.1% of the loan amount ― whichever is larger ― for (TAH) loans
  • Typically requires a loan origination fee
  • Typically requires between $8,000 and $12,000 in legal fees
  • Lender application fees also required, with an average of $15,000, including third-party reports, but may vary based on the specific lender
  • 2% rate lock fee usually required, which is refunded after Freddie Mac purchases loan, usually around 30 days post-closing