Fannie Mae Supplemental Financing 

Fannie Mae Supplemental Loans for Apartment Buildings and Multifamily Developments 

If you're an investor who currently owns a property financed with a Fannie Mae multifamily loan, but you want more funding, a Fannie Mae Supplemental Loan could be a fantastic option. Starting at a minimum of $500,000, these loans offer a maximum LTV of up to 75% and fixed-rate terms of between 5 and 30 years. Just like other Fannie Mae multifamily loans, Fannie Mae Supplemental Loans offer competitive interest rates and are mainly non-recourse. Plus, non-recourse Supplemental Loans are fully assumable (with lender approval and a 1% fee.) Typically, Fannie Mae borrowers are permitted to take out only one Supplemental Loan; however, if the loan is assumed by another party, a second Supplemental Loan is usually permitted. 

Sample Fannie Mae Terms For Multifamily Supplemental Loans 2021

Size: $500,000 minimum

Terms: 5-30 year fixed-rate loan terms available, may or may not be coterminous with original Fannie Mae mortgage  

Amortization: Up to 30 years

Maximum LTV: 75% (may vary based on how proceeds are used) 

Minimum DSCR: 1.30x (may be more under certain conditions) 

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

Prepayment Options: Yield maintenance or defeasance 

Eligible Properties:  

  • Conventional multifamily properties, Multifamily Affordable Housing (MAH), seniors housing properties, and student housing developments with existing Fannie Mae loans

  • Bond Credit Enhancement transactions are permitted with Fannie Mae approval

Timing: Loans typically close between 45 and 60 days after initial application 


  • Competitive interest rates

  • Allows borrower to access equity in their property without refinancing

  • Streamlined documentation/underwriting process

  • Most loans are non-recourse

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

  • Loans are fully assumable with lender approval and a 1% fee


  • Requires third-party reports including an Appraisal, a Property Condition Assessment, and a Phase I Environmental Update. A Seismic Report may also be required if property is located in Seismic Zones 3 or 4.

  • Typically requires $10,000 in lender fees (including third-party reports, though this may vary by lender)

  • Often requires between $8,000 and $12,000 in legal fees

  • Requires a $20,500 application deposit

  • Requires a 1% approval fee (for non-recourse loans)

  • Not available for Fannie Mae loans with remaining loan terms of less than 5 years

  • 2% deposit typically required at rate lock (refunded after Fannie Mae purchases the loan, usually around 30 days after closing)