Freddie Mac Conventional Floating Rate Loan

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Terms

Eligible Property Types

Conventional structured transactions including standard multifamily, student, seniors, and manufactured housing. Floating-rate loans are not available for cooperative housing.

Max Amortization
30 years

Max Loan to Value
80%

Minimum Coverage
1.25x, on comparable fixed-rate mortgage constant

Borrower

  • Borrower may generally be a limited partnership, corporation, limited liability company, or a tenancy-in-common (TIC) with 10 or fewer tenants in common
  • General partnerships, limited liability partnerships, REIT’s and certain trusts may also be acceptable in limited circumstances, subject to additional requirements
  • Borrower must generally be a Single Purpose Entity (SPE); however, on loans less than $5 million, upon Borrower’s request, a Borrower other than a TIC may be a Single Asset Entity (SAE) instead of an SPE
  • If the Borrower is structured as a Tenancy in Common (TIC), each Tenant in Common must be a SPE

Recourse Requirements
Non-recourse except for standard carve-out provisions

Interest-Only Period
Partial-term and full-term interest-only available

Lock-out/Prepayment Provisions
Four lock-out/prepayment options available (see chart below) with no prepayment premium for final 90 days; other options are available for loans that are not intended to be securitized.

Prepayment Premium Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8
Option 1 Locked out 1% 1% 1% 1% 1% 1% 1%
Option 2 3% 2% 1% 1% 1% 1% 1% 1%
Option 3 5% 4% 3% 2% 1% 1% 1% 1%
Option 4 (only for 10-yr capped
floating-rate loan)
7% 6% 5% 4% 3% 2% 1% 1%