Multifamily Loan Rates

Multifamily loan rates vary based on leverage, location, asset class and DSCR. The most common options include Fannie, Freddie, HUD, CMBS, banks, life companies and conduit lenders.


These programs offer some of the lowest apartment loan rates in America. They are non-recourse and allow up to 85% LTV. They work off of an index plus a spread.


FHA or HUD loans are backed by the government, giving lenders added security and protection against default. They typically allow for lower credit scores and down payment requirements than conventional mortgages, making them more accessible to borrowers with less-than-perfect financials. In addition, FHA multifamily loan programs offer a range of generous terms. These include high leverage ratios, flexible financing terms, and amortization periods that extend to decades.

FHA multifamily mortgages have an advantage over conventional ones in that they can be assumed by a new owner if the borrower meets certain criteria. This makes them an excellent choice for investors who want to divest themselves of a property, or for owners looking for a quick way to cash out.

To qualify for an FHA loan, borrowers must verify their incomes through pay stubs, W-2s and federal tax returns. They must also prove their employment and provide full statements of assets, such as checking and savings accounts, 401(k)s and IRAs.

HUD’s mandate is to oversee various federal housing programs. It primarily supports community development and homeownership through initiatives such as the Fair Housing Act and the Home Choice Voucher program. While it does offer some commercial lending programs, these are limited. In contrast, the FHA insures multifamily and single-family mortgages, as well as mortgages for manufactured housing and home improvements.

Fannie Mae Loans

Founded at the end of the Great Depression, Fannie Mae is the first company of its kind created to make homeownership more accessible. Fannie Mae works by buying mortgage loans from banks, credit unions, and mortgage lenders in order to increase lending activity. This reduces the risk for mortgage lenders, allowing them to provide home loans to more people. Additionally, Fannie Mae also offers counseling services and operates programs such as HomePath.

Fannie Mae multifamily loans offer a variety of attractive features that make them an excellent choice for apartment investors of all types. These include non-recourse financing, 30-year fixed-rates, and up to 80% leverage.

To qualify for a Fannie Mae loan, you’ll need to meet certain guidelines, including credit score and income limits. Generally, a debt-to-income (DTI) ratio of 36% or lower is acceptable, although it’s possible to qualify with a higher DTI if your income meets certain criteria.

In addition, you must be able to afford a mortgage of up to $726,200 for a single-family home in most parts of the country. However, loan limits are higher in high-cost areas. Additionally, if you’re purchasing a manufactured home or a condo, the minimum down payment is 10%. In the past, Fannie Mae made some questionable investments that led to massive losses during the financial crisis in 2008. The federal government took over management of the company, known as conservatorship.

Freddie Mac Loans

Freddie Mac is another of the government-sponsored enterprises (GSEs) tasked with providing liquidity, stability and affordability to the housing market. Like Fannie Mae, Freddie Mac offers mortgages to banks and other lenders. They buy the loans and then sell them to investors, offering borrowers a more affordable option for home ownership. The company was created in 1970, after it became apparent that the housing market needed a private, independent, and liquid entity to buy mortgages from banks and other lenders.

In addition to the traditional fixed-rate conventional loan, Freddie Mac also offers a variety of specialty multifamily lending programs. These include Freddie Mac Green Advantage, an environmentally focused program that complements many of the lender’s existing programs. Freddie Mac also offers a Float-to-Fixed loan, which allows borrowers to enjoy the flexibility of a variable-rate mortgage for the first 24 months of their term, and then lock in a fixed rate at closing to protect them from future market fluctuations.

Freddie Mac offers several other lending options, including a CHOICERenovation mortgage, which is designed to meet the unique needs of homeowners who wish to age in place or make renovations to their homes. Additionally, Freddie Mac offers the CreditSmart financial capability curriculum, which provides educational tools and resources to help consumers build, maintain and manage their finances.

Bank Loans

Unlike HUD and FHA loans, bank multifamily loan programs offer a range of long term fixed rate terms with full amortization. These loans can be used to purchase or refinance properties with a maximum LTV of up to 85% for purchase and up to 80% LTV for rate and term and cash out refinances. These non-recourse loans are available to borrowers with good credit and a solid DSCR.

These loan programs are typically the starting point for apartment investors, however there are other options for more advanced borrowers. These include life companies, which provide low-rate fixed rate terms with limited documentation, and conduit lenders, which are an excellent option for seasoned investors who can meet high net worth requirements. On larger deals, second position financing known as mezzanine loans can be layered on top of a bank or CMBS loan for additional leverage.

To find out more about the many different types of loan products that are available for multifamily real estate investments, fill out the form below to speak with an experienced apartment lending specialist. Our team of experts can help you compare rates from Fannie, Freddie, CMBS, HUD, banks, and life companies with no cost, pressure, or obligation. All loan programs are subject to underwriting and credit criteria, so the best way to determine which one is right for you is to contact us today.