Freddie Mac

Fannie Mae DUS^® Green Financing Benefits 

• Pricing incentive of 22-30 bps interest rate reduction from standard  Fannie Mae DUS^®rates
• Higher LTV and lower DSCR for Green Preservation Plus loans
• Increased cash flow with reduced energy expenses, lower water costs, and new revenue from electricity-generating solar systems
• Access to broader MBS investor market interested in Fannie Mae’s  environmentally-focused Green MBS
• Up to 5% higher loan proceeds to finance energy- and water-saving property improvements with Green Rewards and Green Preservation Plus

REQUIREMENTS

There are three types of Green Financing Products:

Green Building Certification

• Conventional and Affordable Multifamily Properties are eligible
• The property must possess a current Fannie Mae’s  recognized Green Building Certification prior to a rate lock
• ENERGY STAR Reporting required

Green Rewards

• Conventional and Affordable Multifamily Properties are eligible
• A portion of proceeds must finance green property improvements
• Up to 75% of projected energy and water cost savings may be included in NOI calculation, including tenant savings up to 25% of the total projected energy and water savings
• Fixed or adjustable-rate
• Improvements must be made within 12 months of closing Replacement reserves, taxes and insurance escrows are required
• ENERGY STAR Reporting required

Green Preservation Plus

• Affordable Multifamily Properties are eligible
  Energy- and water-saving improvements must equal at least 5% of the loan amount, 5% higher than applicable LTV limitation for the loan
• 5 bps lower than the applicable DSCR requirement for the loan; Fixed rate only
• Improvements must be made within 12 months of closing
• Replacement reserves, taxes, and insurance escrows are required
• ENERGY STAR Reporting required

Federal Housing Administration (FHA)

Federal Housing Administration-approved Mortgagee and MAP/Lean lender that actively underwrites, funds, and services FHA   insured mortgage loans for multifamily housing, seniors housing, assisted living, and skilled care properties nationwide. The FHA mortgage insurance programs are available to for-profit, non-profit and public owners. These programs provide long-term, fixed-rate, non-recourse financing for the following:

·        Section 207:

New Construction or Substantial Rehabilitation of Multifamily Manufactured Home Parks.

·        Section 220:

Financing for Apartments in Urban Renewal Areas.

·        Section 221(d):

New Construction or Substantial Rehabilitation of Apartments.

·        Section 223(f):

Acquisition or Refinance of Apartments.

·        Section 231:

New Construction or Substantial Rehabilitation of Apartments where all residents must be 62 years or older.

·        Section 232 pursuant
to Section 223(f):

Acquisition or Refinance of Skilled Care Nursing Homes, Intermediate Care, Assisted Living, and Personal Care Facilities (Board and Care Facilities).

·        Section 223(a)(7):

Refinance of Existing FHA Insured Mortgages (to Reduce the Interest Rate and Pay Associated Costs).

·        Section 241:

Supplemental Loan Program for Renovation or Expansion of Existing FHA Insured Apartments, Nursing Homes, Assisted Living Facilities, and Personal Care Facilities.

·        Section 242:

New Construction or Substantial Rehabilitation of Acute Care Facilities Including Critical Access Hospitals.

As the mortgage insurance provider of HUD, FHA will insure mortgages to finance the acquisition, new construction, substantial rehabilitation, and refinance of multifamily and healthcare properties nationwide. Loan commitments can be funded on a taxable basis or used as credit enhancement for tax-exempt bond issues. Properties insured by FHA can be either “market” rate (i.e. not subsidized), affordable housing, or rental assisted housing. HUD does not require low-income tenancy set-asides nor does it impose rent limits on insured properties, though the use of tax-exempt bonds or low-income housing tax credits can trigger these requirements.

 

Freddie Mac Small Balance Loan Program

The Freddie Mac Small Balance Loan program includes the following features:

• Both fixed-rate and hybrid ARMs available
• Hybrid ARM product fixed for first 5, 7, or 10 years and then floating over 6 month LIBOR for remaining term
• Lifetime cap set at 500 bps over start rate
• Lifetime floor set at the fixed start rate
• Gross margin of 325bps for all hybrid products
• Maximum 1% periodic rate adjustment (up or down)
• Actual/360 interest payments

Offer flexible prepayment options and highly competitive rates with maximum proceeds. Loans are non-recourse and assumable, and cash out is