Freddie Mac provides tax-exempt bond credit enhancement for the construction and rehabilitation of multifamily properties. Like Fannie Mae, Freddie Mac products are priced higher than HUD but the application process is more streamlined. Further, there are no Davis-Bacon requirements and you can expect a realistic closing in 90 days with Freddie Mac. Freddie Mac credit enhancement applies to fixed-rate bonds only.

Typical terms for new construction deals in today’s lending environment:

DCR: 1.15
Loan to Value: Up to 90%
Interest Rate: 6.00-6.25% (Fixed / Forward Commitment)
Amortization: 35 years
Term: 15 years
Non-Recourse: Yes
Davis Bacon Requirement: No
Closing Time Frame: 90 days after bond inducement

Typical terms for renovation deals in today’s lending environment:

DCR: 1.15
Loan to Value: Up to 90%
Interest Rate: 4.50-6.00% (Fixed)
Amortization: 35 years
Term: 15 years
Non-Recourse: Yes
Davis Bacon Requirement: No
Closing Time Frame: 90 days after bond inducement

According to the Wall Street Journal, the top six Freddie Mac lenders financed $18.8 billion in multifamily loans last year:

1) CBRE Capial Markets – $6.2 billion
2) Berkadia Commercial Mortgage – $3.6 billion
3) Wells Fargo Multifamily Capital – $2.4 billion
4) Holliday Fenoglio Fowler, LP – $2.4 billion
5) Walker & Dunlop, LLC – $2.3 billion
6) NorthMarq Capital, LLC – $1.9 billion

Feel free to contact me (Jeff Carroll) at 704-905-2276 with any questions you may have regarding your bond-financed property.