Fannie Mae Multifamily Financing for Senior Housing Developments 

Fannie Mae Loans for Independent Living, Assisted Living, and Alzheimer's/Dementia Care Centers

With more than 10,000 Americans turning 65 every single day, it has never been a better time to invest in the senior housing industry. If you're an experienced investor or developer interested in purchasing a senior housing project, a Fannie Mae Seniors Housing Loan might be the perfect fit. Fannie Mae Seniors Housing Loans have terms and amortizations up to 30 years, fixed and adjustable-rate interest options, and can be used to acquire or refinance independent living, assisted living, and Alzheimer's/Dementia care facilities. Fannie Mae Seniors Housing Loans have a minimum loan amount of $5 million, allow LTVs of up to 80%, and are assumable (with a 1% fee and approval from both Fannie Mae and the lender.) 

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

Sample Fannie Mae Terms For Seniors Housing Loans 2021

Size:  $5 million minimum (exceptions can be made on an individual basis)  

Terms:  5-30 years

Use:  Acquisitions or refinances

Amortization:  Up to 30 years

Interest Rates:  Fixed and adjustable-rate loans available 

Maximum LTV

  • 75% (80% for fixed-rate, tax exempt bonds)

  • 70% for Alzheimer's/Dementia care properties

  • 70% for properties with a Skilled Nursing component

  • Decrease max. LTV by 5% for cash-out refinances

Minimum DSCR 

  • 1.30x for independent living only

  • 1.40x for properties with 50% or more Alzheimer's/Dementia care

  • 1.45x for 100% Alzheimer's/Dementia care properties

  • 1.50x for properties with a Skilled Nursing component

  • Weighted average calculation for properties with less than 50% Alzheimer's/Dementia care units

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

Prepayment Options:  Yield maintenance, defeasance, or graduated prepayment premiums

Commercial Space Limits: Commercial space must comprise no more than 10% of the net rentable area and produce no more than 10% of the project's effective gross income

Eligible Properties: 

  • Properties must have at between 5 and 50 units

  • Properties must be stabilized, and can include manufactured housing communities

  • For acquisitions or refinances, loans must be first lien

  • Eligible borrowers must be single asset entities

  • No properties with entrance fees are allowed

  • Owner/operators must have at least 5 years successful experience in senior living communities, and must have owned/managed 5 or more senior housing properties


  • Competitive interest rates

  • Most loans are non-recourse

  • Flexible prepayment options

  • Supplemental financing is allowed

  • 30- 90 day rate locks available (early and extended rate locks are also available-- early rate locks allow borrowers to lock the rate between 45 and 365 days before closing)


  • Requires third-party reports including an Appraisal, Property Condition Assessment, Zoning, Termite, Flood and Seismic reports (for properties in specific areas), a Phase I Environmental Assessment, and a Seniors Housing Liability Assessment Report

  • Replacement reserves are required ($300/unit per year)

  • Typically requires 90% economic occupancy for 12 months (for independent living facilities) or 15 months (for Alzheimer's/Dementia care or Skilled Nursing properties), though this may vary

  • Typically requires $15,000 application deposit and $3,000 non-refundable processing fee

  • Typically requires a 1% origination fee

  • A 2% rate lock fee is required (refundable at closing)

  • Commitment fees may also be charged