Fannie Mae Structured ARM Loans
Fannie Mae Structured ARM Loans, or SARMs, are designed to finance large apartment and multifamily properties. SARMs start at a minimum of $25 million, are non-recourse, and permit LTVs up to 75% and DSCRs as low as 1.00x.
Fannie Mae Structured Adjustable-Rate Financing for Multifamily Properties
Fannie Mae Insured ARM Loans for Large Apartment Buildings and Multifamily Developments
If you're a multifamily investor looking for a large, adjustable-rate loan for an apartment building or multifamily property, a Fannie Mae Structured ARM could be a great fit. With a minimum loan amount of $25 million, the Structured ARM is designed to finance large multifamily properties, and, with a generous minimum DSCR requirement of 1.00x (at the maximum interest rate), many multifamily investors are finding that Fannie Mae Structured ARMs have the flexibility they need. Plus, Structured ARMs are fully non-recourse, and are fully assumable (with lender approval and a 1% fee.)
To learn more, check out our official Fannie Mae Structured ARM Product Sheet or keep reading below for an in-depth explanation of Fannie Mae’s Structured ARM loan program.
Qualify for a fannie Mae structured arm Loan!
Sample Fannie Mae Terms For Structured ARM Loans 2021
Size: $25 million minimum loan amount
Terms: 5, 7, or 10 years
Amortization: Up to 30 years
Interest Rate: Based on the 1-month or 3-month LIBOR, both convertible and non-convertible options are available
Interest Rate Cap: No built-in caps, borrowers need to purchase an interest-rate cap from an approved provider. Initial interest rate caps must be at least 4 years, but, if the interest rate cap is smaller than the loan term, the borrower must put funds in escrow monthly for the next cap.
Maximum LTV: Up to 75%
Minimum DSCR: 1.00 (at max. interest rate)
Prepayment Options: 1 year lockout, then a 1% prepayment premium or declining prepayment premium
Occupancy Requirements: 85% physical occupancy, 70% economic occupancy
Commercial Space Limits: Commercial space must be no more than 35% of the net rentable area and must produce no more than 20% of the property's income
Eligible Properties: Properties must be stabilized; can include market rate, affordable, student housing, military housing, seniors housing, and manufactured housing community properties
Competitive interest rates
Loans are non-recourse
Requires third-party reports including a property appraisal, property condition assessment, and a Phase I Environmental Assessment
Requires replacement reserves (minimum of $250/unit per year)
$12,500 application deposit and $3,000 processing fee required
1% origination fee also required
Does not allow for supplemental financing before conversion to a fixed-rate loan
Only 30 day rate lock commitments are available