Fannie Mae Financing for Student Housing 

Fannie Mae Insured Multifamily Loans for Student Housing Developments

Colleges and universities provide an essential service by educating the next generation of American leaders, workers, and innovators-- but to get that education, their students need proper housing. If you're an investor interested in providing housing for undergraduate or graduate students, a Fannie Mae Student Housing Loan could be the ideal solution. Just like most other Fannie Mae multifamily loan options, Fannie Mae student housing loans offer competitive interest rates, are mainly non-recourse, and are fully assumable (with lender approval.)

Sample Fannie Mae Terms For Student Housing Loans

Size: $1 million+ (no set maximum) 

Terms: 5- 30 year fixed and varibale-rate loan terms available 

Amortization: Up to 30 years

Maximum LTV: 75% 

Minimum DSCR 1.30x for fixed-rate loans, 1.05x for variable-rate loans (subject to fixed-rate test) 

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

Prepayment Options: Yield maintenance or 1% prepayment penalty, whichever is larger

Eligible Properties: 

  • 40% or more units must be leased to undergraduate or graduate students 
  • Must not be located on University-owned land (with the exception of Dedicated Student Housing Properties)  

Dedicated Student Housing Properties: 

  • Must have at least 80% of the units leased to graduate or undergraduate students
  • Need to be located near a college/university campus with at least 10.000 students enrolled, and at least 50% of those students enrolled full-time
  • Have at least 80% of leases with 12-month terms (guaranteed by parents), or leased by student tenants with the financial capability to pay their lease 
  • Needs to be within 2 miles of campus or a college/university transportation line
  • Must be operated for one school year and be in its second year of operations 
  • Can be located on university-owned land (provided key principal has at least 5 years of experience and "operates at least one other Dedicated Student Housing Property" on college or university owned land)


  • Very competitive interest rates 
  • Up to 75% LTV
  • Most loans are non-recourse 
  • Supplemental loans allowed after 12 months 
  • Rate locks available after commitment, with 6 month extended rate locks also available 


  • Requires replacement reserves 
  • Requires at least 40% student occupancy (may be up to 80% undergraduate-only occupancy for some lenders) 
  • Owner/operators must have a proven track record in the student housing industry 
  • Student tenants must typically sign 12-month leases guaranteed by parents, or must be currently employed and have good credit