Fannie Mae Financing for Recently Rehabilitated Affordable Properties

Fannie Mae Insured Supplemental Loans for Moderately Rehabilitated Multifamily Affordable Housing (MAH) Developments 

Properties that have recently finished a moderate rehabilitation with a Fannie Mae loan often need a new source of funds-- but financing that works well for conventional properties isn't always ideal for affordable housing developments. That's why Fannie Mae has created a Moderate Rehabilitation (Mod Rehab) Supplemental Mortgage Loan for Affordable Properties, designed specifically for the needs of Fannie Mae financed Multifamily Affordable Housing (MAH) properties. In comparison to conventional Fannie Mae Moderate Rehab Supplemental Loans, these loans offer longer amortizations, higher LTV allowances (up to 90% in certain cases), and lower minimum DSCR requirements. Plus, these loans are fully assumable with lender approval.

Sample Fannie Mae Terms For Moderate Rehabiliation Supplemental Loans for Affordable Properties

Size:  Varies

Terms:  5-30 years, must end at the same time as the original mortgage loan 

Amortization:  Up to 35 years

Interest Rates:  Fixed and variable-rate loan options available 

Maximum LTVLTV of up to 85% (varies based on specific property type, and may be up to 90% for earn-outs and other, specific situations)  

Minimum DSCR As low as 1.15x (depending on specific property type) 

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

Rehab Requirements: Property improvements must average at least $8,000/unit, and at least 60% of the budget should be allocated to improving interior units 

Eligible Properties: 

  • Must already have a original Fannie Mae mortgage for moderate rehabilitation

  • Fannie Mae must be the only debt-holder on the property

  • Lender must be servicer of the original Fannie Mae mortgage loan


  • Fast underwriting and approval process

  • Competitive interest rates

  • Loans are non-recourse

  • 30-180 day rate locks (streamlined rate locks also available)

  • Lower cost than refinancing

  • Not subjected to Fannie Mae's "one supplemental loan" rule

  • No waiting period, can be originated within 36 months of the original moderate rehabilitation loan


  • Requires third-party reports including a property condition assessment and a Phase I Environmental Assessment (may not be required in certain circumstances)

  • Fannie Mae must be the only debt-holder on the property