Apartment Building Loans From $1,000,000

Apartment Building Loan / Multifamily Loan Rates - Rates updated February 17th, 2020

Loan Product Rates (start as low as) LTV Amortization
5 Year Fixed 3.52% Up to 80% Up to 30 years
7 Year Fixed 3.68% Up to 80% Up to 30 years
10 Year Fixed 3.84% Up to 80% Up to 30 years

We are experts in securing apartment building loans. Sometimes referred to as multifamily mortgage loans, these types of loans have traditionally constituted the largest portion of our total business volume. We have information that can help you with How to Buy an Apartment Building. Whether you are looking to finance a small apartment building, a complex with hundreds of units, or a co-operative looking for an underlying mortgage, we can help you find the optimal financing solution to meet your apartment mortgage loan needs. Our company has access to multiple capital sources, including: Fannie Mae, Freddie Mac, HUD, numerous local and national banks, Wall Street conduit lenders, Agency lenders, credit unions and insurance companies. We will entertain multifamily loan requests of all sizes, beginning at $1,000,000. See our article published in a major magazine on How to Invest in an Apartment Building. We arrange financing for the following:

  • Large urban high-rise apartment buildings
  • Suburban garden apartment complexes
  • Small apartment buildings containing 5+ units
  • Underlying cooperative apartment building loans
  • Portfolios of small apartment properties and/or single-family rental properties
  • Other multi-family and mixed-use properties

Our company has multiple capital sources for these loans, including: Fannie Mae, Freddie Mac, FHA, national banks, regional and local banks, insurance companies, Wall Street conduit lenders, credit unions and private lenders. Whether you are purchasing or refinancing, we have the right solutions available. We will entertain loan requests of all sizes, beginning at $1,000,000. Click here to get started with a free loan quote.


Our Apartment Building Loan Benefits

Apartment building loan rates start as low as 3.52% (as of February 17th, 2020)
• No upfront application or processing fees
• Simplified application process
• Financing up to 80% LTV
• Terms and amortizations up to 30 years
• Long term fixed rates
• Loans for purchase and refinance, including cash-out
• 24 hour written pre-approvals with no cost and no obligation

Apartment Loans – 2019 Apartment Forecast

National economy affects apartment loans:
• Accelerated job creation in 2018 drove the unemployment rate of young adults between 20 to 34 years old to a 48-year low of 4.5 percent. With two-thirds of this age group living in rentals, they are a dominant force supporting apartment demand, and the strong job market has empowered more of them to move out on their own.

• The monthly payment on a median-priced home increased by $175 last year to nearly $1,700 per month, dramatically widening the disparity between a mortgage payment and the average monthly rent. This widening payment gap, together with tighter underwriting, has restrained young adults’ migration into homeownership, reducing the under-age 35 homeownership rate to 37 percent, down from the peak of 43 percent in 2007. This confluence of factors will likely carry into 2019, sustaining young adults’ preference for rental housing.

• Though consumption and corporate investment will support economic growth in 2019, trade imbalances and a likely weaker housing market will weigh on momentum. Job creation, facing an ultra-tight labor market, will dip to the 2 million range, but wage growth should push above 3 percent.

National apartment overview and its effect on apartment building loans:
• As new households are formed next year, much of the rental demand will center on apartments that serve the traditional workforce: Class B and C properties.

• New inventory largely caters to more affluent renters. As a result, Class A vacancy is expected to rise to 5.8 percent while Class B apartment vacancy remains relatively stable at 4.7 percent. The most affordable segment of the market, Class C apartments, faces strong demand and vacancy for these rentals is expected to tighten to 3.9 percent, its lowest year-end level in 19 years.

• While primary markets such as Boston, Los Angeles, the Bay Area and New York City are expected to see the largest dollar rent increases, smaller metros are generating faster increases on a percentage basis. Metros across the Southeast and Midwest in particular are generating outsize employment growth and housing demand.

Capital markets update – lender interest in making new apartment loans:
• Upward pressure on short-term yields has increased concern an inverted yield curve could occur. A potential inverted yield curve will weigh on confidence levels and could possibly erode consumption and stall the growth cycle. The typical onset time of a recession following an inversion is about one year, but there have been two false positives in which a recession did not follow an inversion.

• Most lenders, particularly Fannie Mae and Freddie Mac, have adapted to a more fluid financial climate. When Treasury rates increased in the third quarter, many lenders tightened their spreads to cushion volatility. Lenders remain cautious, adopting tighter underwriting standards but aggressively competing to place capital into apartment assets.

Investment outlook affects apartment loans:
• Strong demand drivers supporting long-term yield models will counterbalance much of today’s market volatility, encouraging investors to look beyond any short-term turbulence.

• As multifamily yields have compressed, the increasing portion of mobile capital acquiring assets priced over $15 million has migrated to secondary and tertiary markets.

Fannie Mae Multifamily Financing

Fannie Mae is one of the nation’s leading secondary market sources of capital for apartment building financing. Fannie Mae provides mortgage capital for conventional, affordable housing, cooperatives, senior housing, student housing, manufactured housing communities and mobile home parks nationwide. Fannie Mae's apartment loan program offers many distinct advantages over traditional bank programs, including: long-term fixed rates up to 30 years, high LTV ratios up to 80%, and nonrecourse financing (no personal guarantee to the principals). Fannie Mae's offerings include:

Fannie Mae Multifamily Loans (Small)


Simplified loan approval process for long term fixed rate financing for apartments, manufactured housing, mobile home parks, and cooperative apartments.

Loan Amount

$1,000,000 – $3,000,000 nationwide - up to $5,000,000 in major markets

Loan Terms

Fixed rates for 5, 7, 10, 12, 15, 20 and 30 years


Up to 30 years, based on the age and condition of the property

Prepayment Penalty

Yield maintenance and step-down options available


Non-recourse lending is available

Debt Service Coverage

1.25x minimum

Loan to Value

Up to 75% maximum LTV for refinances and 80% for purchases

Subordinate Financing

Supplemental mortgages are available after the first 12 months of the loan term or loan assumption


Typically expect to see 90% occupancy for the previous 3 months


Non-recourse loans are assumable with the Lender’s consent and a 1% fee

Taxes and Insurance Escrows

May be waived on lower LTV loans

Net Worth and Liquidity

Net worth and liquidity requirements must be met

Replacement Reserve Escrows

To be determined based upon appraisal and engineering reports

Rate Lock

Rate lock occurs after commitment is issued; an early rate lock option is also available


Due Diligence Fee: $4,500 – $8,500 non-refundable fee for 3rd party reports and processing


45-60 days from complete application to closing

Fannie Mae Multifamily Loans (Large)


Long term, fixed rate financing for the purchase or refinance of apartment buildings, mobile home parks and cooperative properties

Loan Amount

$3,000,000 and up

Loan Terms

Fixed rates for 5, 7, 10, 12, 15, 20 and 30 years


Up to 30 years, based on property condition; Interest-only financing is available

Loan to Value Maximum

Up to 80%

Coverage Minimum

Typically 1.25x, 1.20x in certain markets


Domestic single asset borrowing entity is required

Interest Rate

Subject to “tiered” LTV ratio (55%, 65%, and 80% tiers) 

Prepayment Terms

Yield maintenance and step-down prepayment options available

Third Party Reports

MAI Appraisal, Physical Needs Assessment, and Environmental Phase I Assessment are required, plus Seismic Report may be required for properties in Seismic Zones 3 and 4


Real estate taxes, insurance, and replacement reserves subject to underwriting guidelines

Application Fee

$10,000; covers 3rd party reports and processing/underwriting costs

Legal Fees

$8,000 to $12,000 varying with characteristics of the deal


45-60 days from application to closing; dependent on 3rd party report timing and borrower’s submission of due diligence

Rate Lock

Typically, lock occurs after commitment is issued; Early Rate Lock option is available, allowing rate lock within 3-4 weeks of application


Loan is assumable, subject to lender approval.

Freddie Mac Multifamily Loan Program (Small Balance)

Freddie Mac is another nationwide source of mortgage capital for apartment building financing. Up until recently, Freddie Mac focused exclusively on large balance loans. Now, Freddie Mac has unveiled a small balance apartment loan program to compete with Fannie Mae. These loans have very competitive rates, flexible prepayment options, and allow for cash out. These loans are called hybrid ARMs as they have fixed rates for the initial 5, 7, or 10 years followed by an adjustable-rate period and 30 year amortizations.  Available options include a five-year fixed followed by a 15 year adjustable, seven year fixed followed by a 13 year adjustable, and a 10 year fixed followed by a 10 year adjustable. All loans come with step down prepayment penalties (such as 5%, 4%, 3%, 2%, 1%) instead of yield maintenance.

Loan Amount

$1 million to $5 million

Loan Purpose

Purchase or refinance, including cash out refinances


Up to 30 years

Property Types

Apartment buildings of 5+ units

Debt Service Coverage

1.20x in top markets, 1.25x nationwide

Maximum Loan to Value




Credit Score

Minimum of 650

Interest Only

Interest only loans are available


Minimum occupancy of 90% for 90 days


Escrows for taxes and insurance may be waived

Replacement Reserves

Not usually required

Rate Lock Deposit

1% at rate lock, refundable at closing


Annual and lifetime caps on all adjustments



Bank Multifamily Mortgage Program

In addition to offering loans from agency lenders Fannie Mae and Freddie Mac, we also offer many different bank and portfolio loan programs. While the agency lenders typically have the lowest rates available in the market, many times the borrower would be better off obtaining an apartment building loan from a traditional portfolio lender. Often times, a portfolio product will better serve the needs of the borrower by offering more flexible underwriting and loan terms.  Some of the key advantages to a portfolio or bank loan include:

Flexible underwriting guidelines

Flexible prepayment penalties

Properties that are in need of repairs, maintenance, or updating

Properties in less than desirable markets

Properties in smaller markets

Borrowers with difficulty providing tax returns

Borrowers with past credit issues

Properties with less than stellar cash flow

Borrowers who are not citizens or Green card holders

Mixed-use properties containing commercial income

Properties that house college students in college towns

Loans that require cross collateralization with other properties

HUD contracts, HAP contracts and Section 8 tenants acceptable

Mobile home parks and manufactured housing communities

Purchases where the down payment results from a gift from family members

Loans with long-term amortization and no balloon payments

Commercial Mortgage-Backed Securities (CMBS Loans)

Another major source of mortgage capital for apartment building loans is the commercial mortgage-backed securities market through Wall Street investment banks. CMBS lenders make individual loans to borrowers which are then packaged and sold to investors as securities. These loans provide interest rate yield to their investors while contributing liquidity to the capital markets. This liquidity in the markets means lower commercial mortgage rates to borrowers. Borrowers are well served when there are multiple sources of capital in the market. Some of the benefits of a CMBS loan include:


$1 million to $10 million+


Primary, Secondary, and Select Tertiary Markets


Multifamily, Manufactured Housing, Office, Retail, Industrial and Self-Storage


First Lien Mortgage


10 years


25 – 30 years






Fixed rate based on spread premium over 10-year US swap rates


Non-Recourse, except for standard industry carve outs


Permitted after a typical lock out period, subject to defeasance


Permitted, subject to Lender’s Approval and 1% assumption fee


3rd party costs & legal are capped


Real Estate Taxes, Insurance, Replacement Reserves, TI/LC (if applicable), and others as reasonably determined by underwriting

Multifamily Bridge Loan

Very often, a property does not qualify for traditional lender programs for various reasons including: vacant properties, properties with un-stabilized occupancy, properties in need of major repair or remodeling, properties that do not cash flow or are underperforming, or loans that must close with a very quick timeline. These loans are very often best served by a bridge loan. Bridge loans are short-term loans, usually at higher rates than traditional financing that allow the borrower the time and money to reposition a property in order to qualify for traditional bank loans in the future. Some of the benefits of a bridge loan include:



Property Types

All property types considered

Loan Amount

$1,000,000 and up

Loan Term

12 – 36 Months Interest Only

Loan to Value

Up to 75% LTV

Typical Situations

Lease-ups, Repositioning or transitional properties, Foreclosure purchases, Discounted payoffs (DPOs), Cash-out financing, Tight closing deadlines, Refinancing of maturing loans, Properties exiting bankruptcy, Partner buyouts, Hard money loans (considered on a case-by-case basis.)


Cash flowing and non-cash flowing properties

Processing Fee & Expense Deposit

Expense deposit required to cover 3rd party reports and underwriting fees


Tenant improvements, Leasing commissions and Capital expenditures may be escrowed


Personal credit score of 675 or better

Borrowing Entity

Operating entity occupying the property or special purpose entity


Non Recourse


Not assumable


Determined on a case by case basis