Fannie Mae Moderate Rehabilitation Supplemental Loans
Fannie Mae Moderate Rehab Loans have terms between five and 30 years, amortizations up to 30 years, and combined LTVs up to 75%.
Better Financing Starts with More Options$1.2M offered by a Bank at 6.0%$2M offered by an Agency at 5.6%$1M offered by a Credit Union at 5.1%Click Here to Get QuotesFannie Mae Multifamily Financing for Recently Rehabilitated Properties
If you own a property that's recently undergone a moderate rehabilitation with Fannie Mae financing, and you need more funds, perhaps for additional improvements, a Fannie Mae Moderate Rehabilitation Supplemental Loan could be a great fit.
Fannie Mae Moderate Rehabilitation Supplemental Loans have terms of between 5 and 30 years, and amortizations of up to 30 years, though they must end at the same time as the original moderate rehabilitation loan. These loans have a combined LTV allowance up to 75% (though this may be larger for affordable properties), are non-recourse, and are fully assumable with lender approval.
Sample Fannie Mae Terms For Moderate Rehabilitation Supplemental Loans in 2023
Size: Varies
Terms: 10- to 30-year loan terms available, supplemental loans must end at the same time as the original mortgage loan
Amortization: Up to 30 years, interest-only loans are available
Interest Rates: Fixed- and adjustable-rate loans available
Maximum LTV: Combined LTV of up to 75% (may be higher for affordable properties)
Minimum DSCR: Combined DSCR as low as 1.25x (may vary due to asset class and how proceeds are used)
Recourse: Loans are non-recourse with standard “bad boy” carve-outs
Rehab Requirements: Property improvements must average at least $10,000/unit
Eligible Borrowers: Borrowers must typically be U.S.-based single asset entities
Eligible Properties:
Must be a stabilized property, can include multifamily affordable housing properties, student housing, seniors housing, and manufactured housing communities
Must already have an original Fannie Mae mortgage for moderate rehabilitation
Fannie Mae must be the only debt-holder on the property
Advantages:
Competitive interest rates
Loans are non-recourse
Standard rate locks available
Lower cost than refinancing
Not subjected to Fannie Mae's "one supplemental loan" rule
Disadvantages:
- Requires third-party reports including a Property Condition Assessment, Appraisal, and Phase I Environmental Assessment (may not be required in certain circumstances)