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-UpStandard 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

Freddie Mac Program Plus