Fannie Mae Multifamily Loans for Green Housing Developments

Fannie Mae Insured Financing Loans for Green and Energy Efficient Apartment Buildings and Multifamily Properties 

If you want to help the environment while saving a significant amount of money, Fannie Mae's Green Financing programs could be the perfect fit for your multifamily development. Fannie Mae currently has three Green Financing programs: Fannie Mae Green Rewards, Fannie Mae Green Building Certification Pricing Break, and Fannie Mae Green Preservation Plus. Each Green Financing program is designed to provide a 0.10% interest rate discount to Fannie Mae multifamily borrowers, which can result in tens (or hundreds) of thousands in savings over the life of a loan. 

Launched in 2015, the Fannie Mae Green Rewards program allows borrowers to take out 5% more in loan proceeds by factoring in the water and power savings that they'll experience in the future. Fannie Mae Green Rewards program properties need to demonstrate that they'll save at least 20% on their energy and/or water costs in order to qualify. In comparison, the Green Preservation Plus program, which began in 2011, is focused on helping developers of multifamily affordable housing (MAH) properties by increasing LTV allowances up to 85% and allowing for lower DSCR ratios. For the Fannie Mae Green Preservation Plus program, green upgrades must equal at least 5% of the original loan amount.

Finally, the Green Building Certification Pricing Break is designed to give a 0.10% interest rate discount for Fannie Mae acquisition or refinance loans on buildings that have an up-to-date Green Building Certification. Like most other Fannie Mae loans, loans using Green Financing programs are fully assumable, subject to lender approval and a 1% fee. 

To learn more, check out our official Fannie Mae Green Financing Product Sheet or keep reading below for an in-depth explanation of Fannie Mae’s Green Financing program.

Sample Fannie Mae Terms For Green Financing

Size:  Varies

Terms:  Up to 30 years 


  • Green Rewards: Up to 30 years (interest-only options also available)

  • Green Preservation Plus: Up to 40 years, 30 years for balloon loans

Interest Rates: 

  • Green Rewards and Green Building Certification: Fixed and adjustable-rate loans available

  • Green Preservation Plus: Fixed-rate only

Maximum LTV

  • Green Rewards and Green Building: Up to 80%

  • Green Preservation Plus: Up to 85%

Minimum DSCR 

  • Green Rewards: 1.25x for market rate properties, 1.20x for affordable properties

  • Green Building Certification Pricing Break: 1.25x for market rate properties, 1.20x for affordable properties

  • Green Preservation Plus: 1.15x

Recourse:  Most loans are non-recourse with standard “bad boy” carve-outs 

Prepayment Penalty:  Yield maintenance and other declining prepayment options available 

Occupancy Requirements: 85% physical occupancy 90 days before closing, 70% economic occupancy 

Commercial Space Limits: Commercial space must not exceed 35% of the net rentable area and 20% of the project's effective gross income

Eligible Properties: 

  • Market-rate, affordable, senior, military housing, and cooperative properties all eligible

  • Borrowers need to agree to target a minimum 25% reduction in energy or water use


  • 0.10% interest rate discount provided

  • Larger loan sizes permitted (for Green Rewards and Green Preservation Plus)

  • Competitive interest rates

  • Most loans are non-recourse

  • 30- 180 day rate locks available (early/extended rate locks are also available)


  • Requires third-party reports including an appraisal, property condition assessment, Phase I Environmental Assessment, and a High Performance Building (HPB) report (for Fannie Mae Green Rewards and Green Preservation Plus)

  • $12,500 application deposit required

  • $3,000 non-refundable processing fee required

  • 1% loan origination fee required

  • 2% good faith deposit due at rate lock (refundable at closing)

  • Replacement reserves of $250/unit/year required

  • Subordinate financing not allowed without written approval