Freddie Mac NOAH Preservation Loan
NOAH Preservation Loans help nonprofits acquire Naturally Occurring Affordable Housing (NOAH) properties in order to keep rents affordable. NOAH Loans have LTVs up to 80% and DSCRs as low as 1.20x, flexible terms up to 15 years and flexible amortizations up to 30 years.
Freddie Mac Loans for Naturally Occurring Affordable Housing
Freddie Mac NOAH Loans Allow Nonprofits to Acquire Naturally Occurring Affordable Housing Properties
If you represent a non-profit committed to preserving the supply affordable housing for Americans who need it, then Freddie Mac's NOAH Preservation Loan could be a great opportunity to fulfill your organization's mission. NOAH Preservation Loans offer LTV allowances of up to 80% and DSCRs as low as 1.20x. Plus, these loans have flexible terms up to 15 years and flexible amortizations up to 30 years, giving eligible nonprofits a variety of options in their quest to preserve affordable properties for lower-income families.
To learn more, check out Freddie Mac’s official NOAH Preservation Loans Product Sheet or keep reading below for an in-depth explanation of the Freddie Mac NOAH Preservation Loan program.
Qualify for a freddie mac NOAH preservation loan
Sample Freddie Mac Terms For NOAH Preservation Loans 2021
Size: Varies based on LTV and DSCR requirements.
Use: Providing the financing for eligible nonprofits to acquire Naturally Occurring Affordable Housing (NOAH) properties in order to preserve their affordability for tenants.
Terms: Up to 15 years
Amortization: Up to 30 years
Maximum LTV: 80%
Minimum DSCR: 1.25x, 1.20x available with underwriting approval
Prepayment Penalty: Yield maintenance or defeasance (based on transaction structure)
Eligible Properties: Garden, mid-rise, or high-rise multifamily NOAH properties
Eligible Borrowers: 501(c)(3) nonprofit organizations with affordable housing preservation as a stated part of their mission and experience with successful property ownership.
Recourse: To be determined by Freddie Mac at commitment
Affordability Requirements: At least 50% of units need to have affordable rents at 60%, 80%, 100%, or 120% of the area median income (AMI) based on market at the time of origination
Nonprofit must meet at least one of the following:
Have an equity partner providing mission-focused equity
Contribute 100% of the equity themselves (leveraging soft debt as necessary)
Use the Freddie Mac Impact Gap Financing offering
Moderate rehabilitation permitted upon underwriting approval
LTV allowances up to 80%
DSCRs as low as 1.20x
Application fees, commitment fees, and other fees required
Servicing document review fee (discounted to $1,500 per review for items disclosed before origination)