Apartment Building

Freddie Mac Lease-Up Loans

Listed below are the comparisons of the premier lease-up and standard lease-up Freddie Mac programs. On newly constructed properties, lock in a rate and fund a loan before the collateral is fully stabilized.

	Premier Lease-Up	Standard Lease-Up
Description	Financing for newly constructed properties in Tier 1 and Tier 2 markets for qualifying sponsors	Financing for newly constructed properties that do not meet our Premier Lease-Up requirements and parameters
Types of Loans	- Fixed- and floating-rate loans - Interest-only available during the lease-up period as provided for in credit policy
Eligible Properties	- Conventional newly constructed multifamily properties in lease-up - Non Eligible properties include student housing, seniors housing, manufactured housing, and affordable housing
Max LTV	65%	75%
Min DSCR DSCR Calculator	1.25x	1.30x
Minimum Credit Enhancement Requirements	None	Letter of credit or reserve sized to: 5% of the underwritten value for loans with LTVs less than or equal to 70% 10% of the underwritten value for loans with LTVs greater than 70%
Rate Lock	Greater than or equal to 40% of units occupied Greater than or equal to 50% of units leased Greater than or equal to 50% of units issued Certificates of Occupancy	Greater than or equal to 50% of units occupied Greater than or equal to 60% of units leased Greater than or equal to 60% of units issued Certificates of Occupancy
Appraisal Report	The appraisal report must provide the as-is and as-stabilized value for the property; the underwritten value will be based on the as-stabilized value (unless there is an adjustment for something other than construction or income until stabilization)
Funding Requirements	1.0x interest-only DCR (or amortizing DCR, if applicable) Greater than or equal to 55% of units occupied Greater than or equal to 65% of units leased All units issued Certificates of Occupancy	1.05x interest-only DCR (or amortizing DCR, if applicable) Greater than or equal to 65% of units occupied Greater than or equal to 75% of units leased All units issued Certificates of Occupancy
Release of Credit Enhancement Requirements	Not applicable	Minimum 90% occupancy and underwritten net rental income must be achieved for three consecutive months Expenses must be based on the greater of: Underwritten expenses at the time of origination, or Annualized, actual expenses from the time the property reached underwritten occupancy at stabilization Stabilization and/or release of credit enhancement will occur once the property has achieved 1.25x amortizing, policy compliant DCR for 3 months No new third-party reports required Up to 12 months to reach stabilization; if the property does not achieve the 1.25x stabilized DCR during this time frame, then the credit enhancement will be used to resize the loan and recast the payments

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