Fannie Mae Multifamily Small Loans 

Fannie Mae Multifamily Loans for Apartment Buildings and Multifamily Developments

While standard Fannie Mae multifamily loans are incredibly popular among multifamily investors, their $3 million minimum and lengthly documentation requirements means that they might not be the right loan for everyone. Fortunately, Fannie Mae also offers Fannie Mae Small Loans, which have a minimum loan amount of $1 million and a significantly streamlined application process. Just like its larger sibling, Fannie Mae DUS Loans, Fannie Mae Small Loans offer competitive interest rates, are mainly non-recourse, and non-recourse loans are fully assumable (with lender approval and a 1% fee.) 

Keep reading below to learn more, or click here to download our easy-to-read Fannie Mae Small Loan term sheet.

Sample Fannie Mae Terms For Small Multifamily Loans 2021

Size:  $1 million to $6 million

Terms:  5-30 year fixed-rate loan terms available, adjustable-rate and hybrid ARM options also available. Partial and full-term interest-only may also be available. 

Amortization:  Up to 30 years

Maximum LTV:  80%, 75% for refinances 

Minimum DSCR 1.25x 

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

Prepayment Options:  Yield maintenance or a declining prepayment premium (step-down)

Eligible Properties:  Conventional multifamily properties, Multifamily Affordable Housing (MAH) properties; seniors housing developments, and student housing developments with 5+ units, and manufactured housing communities (MHCs) with 50+ pad sites. 

Eligible Borrowers:  Typically must have a net worth equal to the loan amount and liquid assets equal to 6 months mortgage payments 

Commercial Limits:  Commercial space must be no more than 35% of the project's net rentable area and must contribute no more than 20% of its effective gross income

Timing:  Loans typically close between 45-60 days after application 

Credit Requirement:  Typically requires a credit score of 680+ (though this may vary by lender) 


  • Very competitive interest rates

  • Up to 80% LTV allowance

  • Streamlined processing/documentation

  • Capital improvements may be included in the loan amount

  • Most loans are non-recourse

  • Supplemental loans are allowed after 12 months

  • 30- 180 day rate locks available after commitment (extended rate locks also available)

  • No processing fees (except with written approval)

  • Non-recourse loans are assumable with lender approval and a 1% fee


  • Requires replacement reserves ($250 per unit minimum)

  • Typically requires 90% physical occupancy for 12-months before closing. This period may be reduced to 90 days under some circumstances.

  • Requires third-party reports including an Appraisal, reduced Physical Needs Assessment and an Environmental Screen

  • Requires a $10,000 application deposit

  • Typically requires between $4,500 and $13,000 in lender fees (including due diligence fees and third-party reports, though this may vary by lender)

  • Rate lock deposit of 1-2% typically required (refunded at closing)