Apartment Loans
Apartment Loan Department
Top Multifamily Mortgage Programs
Apartment Loan Types
To view our other types of commercial mortgages, click here: Commercial Loans.
Fannie Mae Financing
Across the United States, both in initial and subsequent real estate transactions, financing options are accessible through Fannie Mae, specifically via their Delegated Underwriting Services (DUS) Program. This funding mechanism caters exclusively to properties demonstrating operational stability, mandating a minimum loan principal of $750,000. Interest rates are offered in both fixed and variable formats. Eligible property types for FNMA financing encompass conventional multifamily residential complexes, student accommodation, affordable housing initiatives, and independent living facilities for senior citizens. Loan-to-value ratios can reach a maximum of 80% for property acquisitions and 75% for refinancing activities within specified geographic zones. Borrowers may encounter recourse or non-recourse loan structures.
| Loan Type | Min Loan Amount | Max LTV | Term Length | Amortization |
|---|---|---|---|---|
| Fannie Mae (FNMA) | $750,000 | 80% | 3–30 Years | 15–30 Years |
Freddie Mac Financing
Freddie Mac loans, designed for multifamily residential properties, are secured through a primary mortgage lien on properties encompassing standard apartments, student accommodations, senior living facilities, or affordable housing units. While a minority (approximately 10%) of these mortgages are retained within Freddie Mac’s investment portfolio (FHLMC), the vast majority (around 90%) are securitized and subsequently sold to investors in the bond market.
| Loan Type | Min Loan Amount | Max LTV | Term Length | Amortization |
|---|---|---|---|---|
| FHLMC | $1,000,000 | 80% | 5–30 Years | 30 Years |
FHA Financing - HUD Multifamily Financing
Backed by the Department of Housing and Urban Development (HUD), the Federal Housing Administration (FHA) provides a nationwide guarantee for multifamily mortgages. These loans, designed for either established properties with a minimum three-year operating history (via the 223(f) program) or large-scale construction endeavors (via the 221(d)(4) program), feature attractive interest rates and are structured as fully self-amortizing loans over a 35- to 40-year term. FHA multifamily financing is applicable to a diverse range of properties, including conventional multifamily dwellings, affordable housing initiatives, and senior living communities. Current leverage parameters permit a maximum loan-to-value ratio of 83.3% for acquisitions and 80% for refinance transactions, with minimum loan amounts set at $5 million for purchase or refinance and $25 million for construction projects. Due to the governmental guarantee, these loans are inherently non-recourse, subject to standard carve-out provisions.
| Loan Type | Min Loan Amount | Max LTV | Term Length | Amortization |
|---|---|---|---|---|
| FHA/HUD | $3,000,000 | 83.3% | 30–40 Years | 30–40 Years |
Conventional Multifamily Financing
These mortgages, often referred to as portfolio, wholesale, or conventional multifamily loans, are financed by banks or similar institutional lenders that retain the loans in their own portfolios rather than securitizing and selling them on the capital markets. This direct lending model allows for potentially more adaptable terms compared to securitized loans, as the lender typically manages the servicing in-house. Loan-to-value ratios can reach between 75% and 85%, although this higher leverage is subject to specific conditions and geographic locations. While personal guarantees are generally a prerequisite, they may be subject to waivers or limitations depending on the loan program and level of leverage.
| Loan Type | Min Loan Amount | Max LTV | Term Length | Amortization |
|---|---|---|---|---|
| Conventional | $1,000,000 | 80% | 3–15 Years | 15–30 Years |
Conduit / CMBS Multifamily Loans
Commercial Mortgage-Backed Securities (CMBS) loans, also known as conduit loans, represent a type of financing where individual mortgages are aggregated into a pool and subsequently sold as securities to investors. These loans are accessible across the United States in diverse markets and are generally offered for income-producing, stabilized properties requiring a minimum loan of $2 million. Within the CMBS framework, multifamily financing is typically restricted to conventional apartment complexes or independent living facilities for seniors. Loan-to-value ratios are capped at 75% for both acquisition and refinance transactions, and the loans are structured as non-recourse, limiting borrower liability.
| Loan Type | Min Loan Amount | Max LTV | Term Length | Amortization |
|---|---|---|---|---|
| Conduit / CMBS | $2,000,000 | 75% | 5–10 Years | 20–30 Years |
Commercial Real Estate Insurance Mortgages
Insurance company mortgages, a subset of portfolio lending, generally provide the most competitive interest rates and extended repayment periods available. These loans are predominantly financed directly by life insurance firms, with a preference for robust primary markets, although some secondary market options might exist. While minimum loan sizes are program-dependent, they typically range from $5 million to $10 million. These financing solutions are optimally suited for properties exhibiting low debt-to-equity ratios, strong operational performance, and a classification of “B” or higher, ideally with an age of 15 years or less.
| Loan Type | Min Loan Amount | Max LTV | Term Length | Amortization |
|---|---|---|---|---|
| Insurance | $1,000,000 | 75% | 5–30 Years | 15–30 Years |
Construction Mortgages
Prosper Financing offers a dual suite of commercial lending options tailored for multifamily real estate ventures, encompassing both federally insured (FHA) and traditional (conventional) financing structures.
| Loan Type | Min Loan Amount | Max LTV | Term Length | Amortization |
|---|---|---|---|---|
| FHA Apartment Construction Loans | $3,000,000 | 83.3% | 35–40 Years | 35–40 Years |
| Conventional Construction Loans | $1,000,000 | 80% | 3–15 Years | 15–30 Years |
USDA Mortgages
The United States Department of Agriculture (USDA) offers mortgage guarantees applicable to commercial real estate properties situated within officially designated rural zones, defined as areas with a population not exceeding 50,000 residents. While certain USDA programs may permit loan-to-value (LTV) ratios up to 90%, the majority typically cap LTV at 80-85%. It is crucial to note that USDA-guaranteed mortgages are predominantly structured as full recourse loans, exposing borrowers to broader liability.
| Loan Type | Min Loan Amount | Max LTV | Term Length | Amortization |
|---|---|---|---|---|
| USDA | $1,000,000 | 90% | 5–15 Years | 15–30 Years |