Freddie Mac Financing for Student Housing Developments

Custom Freddie Mac Insured Multifamily Loans for Student Housing Properties 

With millions of college students througout the U.S., there's never been a better time to invest in the student housing market-- and Freddie Mac is here to help. With Freddie Mac Student Housing Loans, investors and developers can help provide housing for the next generation of American leaders, thinkers, and doers, all while accessing LTVs of up to 80%, flexible loan terms of between 5-10 years (up to 30 for non-securitized, fixed-rate loans), and Freddie Mac's reliable, non-recourse loan execution. Plus, Freddie Mac Student Housing Loans also allow supplemental financing and permit early rate-lock and index-lock options in order to reduce risks for borrowers. 

Keep reading below to learn more, or click here to download our easy-to-understand Freddie Mac Student Housing Loan term sheet.

Sample Freddie Mac Terms For Student Housing Loans

Size:  $5 million - $100 million (though smaller and larger loan amounts will be considered)

Use:  Acquisition or refinance 

Terms:  5-10 years (Up to 30 years if loan not purchased for securitization)

Amortization:  Up to 30 years, interest-only loans available

Maximum LTV/Minimum DSCR:  

  • 5-7 Year Loans:

    • Amortizing: 75%/1.35x

    • Partial Term Interest-Only: 75%/1.35x

    • Full Term Interest-Only: 65%/1.45x

  • 7 Year Loans:

    • Amortizing: 80%/1.30x

    • Partial Term Interest-Only: 80%/1.30x

    • Full Term Interest-Only: 70%/1.40x

  • 7+ Year Loans:

    • Amortizing: 80%/1.30x

    • Partial Term Interest-Only: 80%/1.30x

    • Full Term Interest-Only: 70%/1.40x

Recourse:  Non-recourse with standard “bad boy” carve-outs

Prepayment Options: Yield maintenance until securitization, 2-year lock-out period following securitization, defeasance allowed after securitization. Yield maintenance for securitized loans is permitted for an additional fee. No pre-payment premiums required in the last 90 days of the loan. 

Assumability:  Loans are assumable with lender approval, but require a 1% assumption fee paid to Freddie Mac. May also require an underwriting fee paid to the lender (typically around $5,000.)

Eligible Borrowers: 

  • Eligible borrowers include limited partnerships, limited liability companies, corporations, or a tenancies in common (TICs) with 10 or fewer members

  • In some circumstances (and with specific requirements), general partnerships, REITs, limited liability partnerships, and some trusts may also be eligible

  • Typically, borrowers must be single purpose entities (SPEs), however, on loans less than $5 million, borrowers may be able to be Single Asset Entities instead

  • For tenancies in common (TICs), each member needs to be a SPE

Eligible Properties: 

  • "Purpose-built student housing properties; must have a minimum of one bathroom for every two bedrooms, and each apartment must have a separate full kitchen"

  • High-rise, mid-rise, and stabilized garden properties with a 50%+ student concentration are also eligible

  • College/university must have 8,000+ students (combining students multiple schools in a close are will also be considered)

  • Student housing property must be less than 2 miles from college/university or located on a public transport route

  • Residence halls, buildings with shared common bathrooms, and buildings with dining halls not eligible

  • Ground leases on university-owned permitted under certain circumstances (prior approval is required)

Refinancing Test: No test needed for amortizing loans with a DSCR of at least 1.40x and an LTV of less than or equal to 65%. Interest-only loans must pass a refinancing test before they are approved. 

Lease Requirements:  Generally, 12-month leases are preferred, though shorter leases may be accepted. Parental guaranty is preferred. 

Timing: Usually around 60- 75 days between application and closing


  • Very competitive interest rates

  • Up to 80% LTV for some properties

  • Loans are non-recourse

  • Supplemental loans allowed

  • Early rate-lock, fast-track early rate-lock, and index-lock options allowed

  • Loans are fully assumable (with fees)


  • Requires third-party reports including Phase I Environmental Assessment, Appraisal, Physical Needs Assessment, Seismic Report may be required for properties in Seismic Zones 3 and 4. Engineering Report may also be required.

  • Requires annual replacement reserves of $150/bedroom or $300/unit

  • Application fees required: $2,000 or 0.1% of loan amount

  • Typically requires a loan origination fee

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

  • Lender application fees also required (avg. of $15,000, including third-party reports, but may vary based on specific lender)

  • 2% rate lock fee usually required (refunded after Freddie Mac purchases loan, usually around 30 days post-closing)