Freddie Mac American Business Loans

The Freddie Mac Fixed-Rate Conventional loan program offers more flexibility, which makes this loan program an ideal choice for a range of housing projects. Loan commitments are made within 45 days, faster than many of Freddie Mac's more strict programs.

This program can be used to finance:

• Standard housing projects
• Affordable housing (Section 8 and certain LIHTC)
• Senior housing
• Student housing
• Housing cooperatives

Terms

• Flexible Terms: Adjustable
• Broad loan amount range: $5 million to $100 million (flexible)
• Duration Options: 5-10 years (most common), with possible 30-year terms
• Leverage Options: 75 or 80% LTV, based on term and payment structure
• Recourse: Non-recourse (basic carve-outs apply)
• Use: Buy or refinance

When to Use

• When you have the pressure to complete an acquisition or refinance, you can apply for this loan due to its faster commitment times.
• Fixed-rate loans by Freddie Mac are default choices for projects that don't meet other program requirements.

The Freddie Mac Floating-Rate Conventional loan program offers similar flexibility and competitive interest rates. These loans often have the lowest rates offered by Freddie Mac, but can change due to market fluctuations. This loan program is well-suited for:

• Properties expected to be refinanced or sold within a short time frame
• Multi-use projects
• Standard housing projects
• Senior housing
• Student housing
• Manufactured housing (excluding affordable housing)

Terms

• Flexible terms: Accommodates multi-use projects with commercial space
• Fast loan commitment: Completed in just 45 days
• Flexible loan amount: $5 million to $100 million (flexible)
• Duration options: 5, 7, or 10 years
• Leverage options: 75 or 80% LTV, based on term and payment structure
• Recourse: Non-recourse (Basic carve-outs apply)

When to Use

• Short-term projects to take advantage of lower interest rates while avoiding potential risk of rate increases in upcoming years
• Temporary financing as they are ideal for purchases or renovations before selling
• Bridge financing as these loans are suitable for acquisitions with planned refinancing or sale within a short time frame

The Freddie Mac Small Balance Loan Program is created to finance smaller multi-unit residential properties. It provides an affordable alternative to privately insured loans. This program has flexible terms and is designed to compete with Fannie Mae's offerings and is ideal for:

• Properties with at least five units
• Purchasing or refinancing smaller multifamily buildings
• Individuals entering the multifamily rental market

Terms

• Recourse: Non-recourse loans with basic carve-outs
• Loan Amounts: $1 million to $7.5 million
• Duration: 5 to 20 years
• Leverage: Up to 80% LTV

When to Use

• Purchasing smaller multifamily properties, especially in major metropolitan markets where property values are high
• Entering the multifamily rental market with a smaller property
• Refinancing existing smaller multifamily properties to take advantage of better terms

The Freddie Mac Green Advantage Program is an initiative for environmentally conscious investors with more favorable loan terms. This program can be combined with Freddie Mac's conventional, affordable, and senior housing programs and offers a unique opportunity to promote sustainability in multifamily housing. To qualify for Freddie Mac Green Advantage Program, real estate investors must:

• Obtain a Green Assessment, a complete evaluation of the property's environmental efficiency
• Commit to reducing water and sewage usage by at least 25%

In return, investors can enjoy:

• Higher Loan-to-Value (LTV) ratios and more flexible financing options
• Higher Debt Service Coverage Ratio (DSCR) ratios, which means more cash flow
• A rebate of up to $3,500 for the Green Assessment

Terms

• Loan amounts: Vary
• Duration: 2 years to complete environmental improvements
• Leverage: Up to 5% additional LTV
• Recourse: Non-recourse with basic carve-outs

When to Use

• Any investor seeking to enhance their property's environmental sustainability
• Landlords who pay the building's water bill, as reducing water/sewage usage can lead to significant cost savings
• Investors looking to combine the Green Advantage program with other incentives for maximum benefits

The Freddie Mac Student Housing Program is a tailored financing solution responding to the growing demand for student housing. This program offers attractive terms for investors seeking to enter or expand in this thriving sector of the real estate market.

Terms

• Flexible loan amounts: $5 million to $100 million
• Duration options: 5-10 years (most common), with possible 30-year terms
• Leverage options: Up to 75% or 80% LTV, depending on term and payment structure
• Recourse: Non-recourse loans with basic carve-outs

When to Use

• Mid-sized and large student housing projects, such as apartments or townhomes
• To provide student housing
• Acquisition or refinancing of existing student housing properties

The Freddie Mac Senior Housing Program is created to support investments in specialized housing older adult to address their needs and preferences as they evolve with their age.

Freddie Mac's Senior Housing loans address the significant capital needs of senior housing projects. These loans provide access to commercial funding with favorable terms, which makes it easier to build or purchase these properties.

This program offers financing for various types of senior housing, including:

• Independent living
• Assisted living
• Skilled nursing
• Memory care
• Age-in-place properties

Terms

• Flexible loan amounts: $5 million to $100 million
• Duration options: 5-10 years (most common), with possible 30-year terms
• Leverage options: Up to 70% or 75% LTV, based on term and payment structure
• Recourse: Non-recourse loans with basic carve-outs

When to Use

• Financing senior housing projects with unique considerations and costs
• Acquisition or refinancing of existing senior housing properties
• Projects requiring substantial capital due to size and design specifications

The Freddie Mac Manufactured Housing Program offers financing solutions for multi-unit manufactured housing developments, including mobile home parks and other types of manufactured housing communities. This program enables investors and developers to access necessary capital to acquire or refinance these unique properties.

Benefits

• financing: Spreading repayment over 10+ years keeps Debt Service Coverage Ratio (DSCR) lower
• Higher loan-to-value ratios: Allow more revenue to go toward improvements or disbursements
• Attractive option for manufactured housing developments: Financing with favorable terms and flexible loan amounts

Terms

• Flexible loan amounts: $1 million and above
• Duration options: 5-10 years (most common), with possible 30-year terms
• Leverage options: Up to 75% or 80% LTV, based on term and payment structure
• Recourse: Non-recourse loans with basic carve-outs

When to Use

• Financing multi-unit manufactured housing developments, including mobile home parks
• Acquisition or refinancing of existing manufactured housing properties
• Investors and developers who seek long-term financing with flexible terms

The Freddie Mac Supplemental Loan program offers extra financing to cover costs beyond the initial purchase price of a property. This program provides two types of supplemental loans, which are different in terms of when the loans are taken out.

1. Split Supplemental Loans: Taken out simultaneously with the primary Freddie Mac mortgage
2. Seasoned Supplemental Loans: Taken out at least 12 months after the primary mortgage

Benefits

• Manage unexpected costs, significant repairs, or major improvements
• Help improve cash flow in certain situations
• Additional financing to cover unforeseen expenses

Terms

• Flexible loan amounts: $1 million and above
• Duration: May exceed primary loan by 24 months
• Leverage options: Up to 75% or 80% LTV, depending on term and payment structure
• Recourse: Non-recourse loans with basic carve-outs

When to Use

• Unexpected expenses or repairs arise
• Major improvements or renovations are needed
• Cash flow management is required
• Supplemental financing is necessary to support property operations or upgrades