Freddie Mac Conventional Structured Finance
Offers an efficient form of execution for active multifamily investors who are able to pool together similar assets
Key Benefits
- Three Conventional Structured Finance products: Revolving Credit Facility, Multi-Asset Flow Facility and Multi-Asset Crossed Facility
- Built-in pricing and pre-negotiated loan documents
- Ability to lock credit terms and/or interest rates prior to identifying properties to be purchased
At-a-Glance Comparison
| Product Summary | Revolving Credit Facility | Multi-Asset Flow Facility | Multi-Asset Crossed Facility |
|---|---|---|---|
| Product Description | Secured line-of-credit. Borrower can move assets in and out of the facility while adhering to the defined facility-level parameters. | Borrower fills the facility with individual loans at defined credit parameters per the products selected, over a 12- to 36-month period | Immediate funding for acquisition or refinance of portfolio of assets |
| Type of Funding | Continuous funding as assets are moved in and out of the facility | Funding up to 15 days after closing. Use of funding over 12-24 months after origination. | Funding is up to 15 days after lender closing |
| Collateral | First lien mortgages (conventional multifamily, seniors housing and/or student housing) | First lien mortgages (conventional multifamily, seniors housing, student housing), acquisition rehabilitation/ upgrade, acquisition or refinance | First lien mortgages (conventional multifamily, seniors housing, student housing), acquisition rehabilitation/upgrade, acquisition or refinance |
| Available for Securitization | No | Yes | Yes |
| Minimum DCR / Maximum LTV | See charts below | Per defined parameters of product selected | See charts below |
| Fixed or Floating | Both available | Both available | Both available |
| Cross-collateralization | Under one or more notes, assets will be cross-collateralized and cross-defaulted | Individual loans will be non-crossed (noncoterminous) but will consider a crossed feature on an exception basis (coterminous) | Loans will be cross-collateralized/defaulted (coterminous). |
| Assumptions | Non-assumable (facility and mortgage level) | Underlying mortgages assumable if removed from facility; facility not assumable | Underlying mortgages assumable if removed from facility; facility not assumable |
| Other Features |
5- or 7-year term plus 1-year extension |
Substitutions, assumptions and supplemental loan features may be available depending upon combination of products selected | Substitutions, assumptions and supplemental loan features may be available depending upon combination of products selected |
| Annual Valuation | Applicable | May be applicable if crossed | May be applicable depending on negotiated terms |
| Pricing | Floating, full term IO over the 1-month or 3-month Freddie Mac Reference Bills® or LIBOR – no interest rate cap or hedge requirements | Fixed-rate, floating-rate, capped ARMs, acquisition rehabilitation, acquisition upgrade, acquisition, refinance, extended ERL, or standard delivery | Floating-rate, or a combination of fixed- and floating-rate |
| Fees | Transaction fee, mortgage review fee, collateral addition fee, substitution/release fee, minimum usage fee, unused facility fee, termination fee, legal fee | Transaction fee, mortgage review fee, collateral addition fee, substitution/ assumption/release fee, legal fee | Transaction fee, mortgage review fee, collateral addition fee, substitution/ assumption/release fee, legal fee |
Loan-to-Value Ratio and Debt Coverage Ratio
| Revolving Credit Facility | All Products |
|---|---|
| LTV | |
| > 7 Year Term | 70% |
| < 7 Year Term | 65% |
| DCR – Interest-Only | |
| Standard Products | 1.55x |
| Student Housing | 1.60x |
| Seniors – IL | 1.60x |
| Seniors – AL | 1.70x |
| Multi-Asset Crossed | Acquisition and No Cash-Out Refinance | Cash-Out Refinance | |||||||
|---|---|---|---|---|---|---|---|---|---|
| Amortizing | Partial Interest-Only | Interest-Only | Amortizing | Partial Interest-Only | Interest-Only | ||||
| LTV | |||||||||
| > 7 Year Term | 80% | Same as Amortizing | 65% | 75% | Same as Amortizing | 65% | |||
| < 7 Year Term | 70% | Same as IO | 60% | 65% | Same as IO | 60% | |||
| DCR – Standard Products | |||||||||
| > 7 Year Term | 1.25x | Same as Amortizing | 1.55x | 1.25x | Same as Amortizing | 1.30x | |||
| < 7 Year Term | 1.25x | Same as IO | 1.55x | 1.25x | Same as IO | 1.30x | |||
| DCR – Student Housing | |||||||||
| > 7 Year Term | 1.30x | Same as Amortizing | 1.60x | 1.30x | Same as Amortizing | 1.35x | |||
| < 7 Year Term | 1.30x | Same as IO | 1.60x | 1.30x | Same as IO | 1.35x | |||
| DCR – Seniors, Independent Living | |||||||||
| > 7 Year Term | 1.30x | Same as Amortizing | 1.70x | 1.30x | Same as Amortizing | 1.35x | |||
| < 7 Year Term | 1.35x | Same as IO | 1.70x | 1.35x | Same as IO | 1.40x | |||
| DCR – Seniors, Assisted Living | |||||||||
| > 7 Year Term | 1.40x | Same as Amortizing | 1.80x | 1.40x | Same as Amortizing | 1.45x | |||
| < 7 Year Term | 1.45x | Same as IO | 1.80x | 1.45x | Same as IO | 1.50x | |||
Contact Us
- Download and print Freddie Mac's contact information
PDF Version
- Download the Conventional Structured Finance term sheet.
The information in this document is not a replacement or substitute for information found in the Freddie Mac Multifamily Seller/Servicer Guide. Terms set forth herein are subject to change without notice.