Independent Living Facilities and the Freddie Mac SBL Program
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Independent living communities are communities designed for senior citizens, which are generally restricted to individuals 55 and older or individuals 62 and older, depending on the particular community. These communities are also sometimes known as “age-restricted communities.” Unlike assisted living centers or skilled nursing facilities, independent living communities generally do not have resident services, such as group dining or intensive medical units. However, some may have these as options.
In regards to the Freddie Mac Small Balance Loan program, independent living communities are eligible for financing, as long as they do not offer any resident services. Communities that offer resident services may be financed by Freddie Mac Seniors Housing Loans. Looking beyond the scope of Freddie Mac multifamily loans, these communities can also be financed with Fannie Mae Seniors Housing Loans, or the HUD/FHA 232/223(f) loan program.
Related Questions
What is the Freddie Mac SBL Program?
The Freddie Mac Small Balance Loan (SBL) Program is a loan program offered by Freddie Mac to assist small business owners in securing liquidity for their investments. The program ensures approved sellers and servicers have a platform dedicated to selling loans for smaller rental properties. Qualifying projects include multifamily properties with loans that range from $1 million to $7.5 million. Some of the key benefits and features of the program are competitive pricing, less documentation, a streamlined underwriting process, and either hybrid ARM or fixed-rate loan products.
In addition to the property requirement, servicers and sellers must also meet a specific set of guidelines. These include collateral, undergoing a rigorous assessment, B-piece purchase, loss sharing, repurchasing of delinquent SBLs and origination of at least $50 million per quarter.
What are the benefits of the Freddie Mac SBL Program for independent living facilities?
The Freddie Mac Small Balance Loan (SBL) program offers a variety of benefits for independent living facilities, including competitive pricing, less documentation, a streamlined underwriting process, and either hybrid ARM or fixed-rate loan products. Additionally, the program offers a simplified pricing process, a simplified SBL insurance assessment, less documentation, a reduction in due diligence requirements, and easier third party reporting.
For more information, please see the following sources:
What are the eligibility requirements for the Freddie Mac SBL Program?
The eligibility requirements for the Freddie Mac SBL Program include:
- Property requirements
- Servicer & Seller Requirements
- Collateral
- Rigorous assessment
- B-piece purchase
- Loss sharing
- Repurchasing of delinquent SBLs
- Origination of at least $50 million per quarter
For more information, please refer to the Freddie Mac SBL Program Guidelines.
What types of financing are available through the Freddie Mac SBL Program?
The Freddie Mac SBL Program offers either hybrid ARM or fixed-rate loan products. According to Apartment.Loans, the program offers competitive pricing, less documentation, and a streamlined underwriting process.
How can I apply for a loan through the Freddie Mac SBL Program?
You can apply for a loan through the Freddie Mac SBL Program by meeting the servicer and seller requirements and undergoing a rigorous assessment. The program offers competitive pricing, less documentation, a streamlined underwriting process, and either hybrid ARM or fixed-rate loan products. For more information, please visit the Freddie Mac SBL Program page.