Illinois Apartment Loans
$1,000,000 Minimum

Illinois Apartment Loan Rates - Rates updated July 7th, 2020

Apartment Loan Starting Rates LTV
5 Year Fixed Rates 3.41% Up to 80% Get Free Quote
7 Year Fixed Rates 3.49% Up to 80% Get Free Quote
10 Year Fixed Rates 3.53% Up to 80% Get Free Quote
Illinois Apartment Building Illinois
Apartment Building

Select Commercial has excellent apartment building loan and multifamily loan products and options available for owners and purchasers of multi-family and apartment properties throughout the state of Illinois. Whether you are looking to finance a small apartment building, a complex with hundreds of units, or a co-operative, we can help you find the optimal financing solution to meet your apartment mortgage loan needs. While we lend across the entire continental US, we are able to give our best rates and loan programs to certain areas that we feel are strong markets. Illinois is one of the states that we consider to be a premium market for apartment building loans and we actively look to originate good quality loans here for our clients. We have a diverse array of many available loan products to help qualified IL borrowers looking to purchase or refinance an apartment property. We offer apartment loans with terms and amortizations up to 30 years, recourse and non-recourse, and many options for prepayment. We typically approve apartment building loans within 1 day and usually close within 45 days of application. Our clients love our simplified application process, 24-hour pre-approvals with no-cost and no-obligation, great rates and terms, fast closings and personalized service.

Illinois Apartment Loan Benefits

Illinois Apartment loan rates start as low as 3.41% (as of July 7th, 2020)
• No upfront application or processing fees 
• Simplified application process 
• Up to 80% LTV on apartment financing 
• Terms and amortizations up to 30 years 
• Loans for purchase and refinance, including cash-out 
• 24 hour written pre-approvals with no cost and no obligation

Recent TRUSTPILOT Reviews

Select Commercial Funding Reviews from TRUSTPILOT

A three year journey
"Thanks Stephen for all of your hard work in getting our deal closed! I appreciate your professionalism and patience throughout a complicated process. You always were there for my partner and I whenever we had questions and needed answers quick. It was a pleasure to have worked with you and Select Commercial!"


Illinois Apartment Loan Types We Serve

If you are looking to purchase or refinance a Illinois apartment building, don't hesitate to contact us. We arrange financing in the state of Illinois 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

Recent Closings

Apartment Loan Trends in 2020

At the start of 2020 the market outlook did not indicate any significant factors that would cause major trouble in the multifamily market. Market indicators suggested that demand for housing, especially for apartment rentals, would remain healthy, thus continuing to generate new construction of multifamily buildings. Both the high number of permits and starts over the past couple of years led experts to believe that developer confidence is very high in the multifamily market. Market experts predicted an annual completion of 340,000 apartment units over 2020, way above the 300,000-annual average for the past five years. Over the last couple of years, the multifamily market has seen absorptions outperform expectations due to both changes in lifestyle and demographic preferences and new supply has consistently taken longer to be built. These two factors have helped the market to perform stronger than expected in the past and should continue throughout this year. Market data indicated that rent growth would remain strong in 2020, growing 3.6% (which is above the historical average). In terms of mortgage origination, low interest rates and strong multifamily performance were expected to help loan volumes grow. Experts predicted that the origination volume in 2020 will increase by 5.7% to $390 billion. Market data indicated that cap rates have more room to decline, which would lead to increasing property values and should drive up origination volume. However, with the current outbreak of Covid-19, the overall economy has been in flux. The stock market has crashed and commercial mortgage interest rates have been severely impacted. Huge metros such as New York have all but shut down much economic activity and entertainment. In this unsteady climate, many investors are scared to purchase commercial real estate and to take out commercial mortgages and apartment loans. Additionally, the oil industry has taken a big hit. Not only are people traveling less due to the pandemic, foreign countries like China and Russia are involved in a huge price war which is driving the price of oil way down. Experts are hopeful that as the weather warms up and public health policy learns how to handle this pandemic, the economy should revert back to its pre-virus strength.

What Happened with Apartment Loans in 2019

The multifamily market ended the 2019 year on a high note. Despite increased levels of new units entering the market, the apartment sector maintained strong and steady growth throughout the year. Vacancy rates throughout the country remained fairly stable, easing investors’ concerns of a significant decline in occupancy due to the high sum of multifamily units delivered. Furthermore, rent growth on the national and metropolitan levels remained healthy throughout the year. While 2019 rent growth was more modest than 2018, it was in line with 2016 and 2017 levels and remained above the national historic average of 3.4%. Based on data provided by the U.S. Census Bureau, multifamily completions increased slightly in 2019 when compared with 2018. The data also show that reported permit growth has increased 3% and starts are up 2%. Although 2019 data is not yet fully complete, these metrics suggest that the supply will remain elevated over the next few years. In terms of multifamily mortgage origination, the most up to date information has surpassed expectations. Mortgage Bankers Association reported that the 2018 mortgage volume came in at about $339 billion, an increase of 18.9% from 2017. While the actual 2019 numbers will not be available until later this year, experts estimate that due to solid fundamentals, low interest rates and heightened demand for multifamily investments, the total origination volume last year was about $369 billion.

The 2019 economy thrived overall. Throughout the year 2.1 million jobs were added which were in line with 2017 number (although it fell short of the 2018 total of 2.7 million). The unemployment rate also continued to decrease in 2019 as it went down 50 basis points to 3.5% at the end of the year. This number matched the lowest unemployment rate in fifty years. The labor market heavily supported increased salaries, as indicated by the 2.8% annual growth in the Employment Cost Index as of September of 2019. While these gains were below the expected amount for a market with such a low unemployment rate they were above the average for the past decade. At the beginning of the year many investors were concerned due to expectations of a recession. There were many indicators that supported this concern such as inverted two and ten year yield curves, an unanticipated rise in the June unemployment rate of ten basis points, an unstable stock market and slowed job growth. However, during the third and fourth quarters of 2019, the economy improved as job growth rose, the unemployment rate fell. This economic improvement has had a clear impact on the multifamily market as more investors are feeling bullish on putting their money into this asset class.

Illinois Apartment Loan Options

Our company has multiple capital sources for these apartment loans, including: Fannie Mae, Freddie Mac, FHA, national banks, regional and local banks, insurance companies, Wall Street conduit lenders, credit unions and private lenders.

Illinois Apartment Financing with Fannie Mae (FNMA)

Fannie Mae’s multifamily loan platform is one the leading sources of capital for apartment building loans in the US. Fannie Mae is a leader in the secondary market – meaning they purchase qualifying apartment loans from leading lenders who originate these loans for their borrowers. Fannie Mae purchases loans secured by conventional apartments, affordable housing properties, underlying cooperative apartment loans, senior housing, student housing, manufactured housing communities and mobile home parks on a nationwide basis. The Fannie Mae platform has many benefits, including:

  • Long term fixed rates and amortizations. Fannie Mae allows terms and amortizations of up to 30 years. Most banks offer only 5 or 10 year fixed rates and 25 year amortizations.
  • Non-recourse options. Most banks will require the borrower to sign personally for the loan. Fannie Mae offers non-recourse loans.
  • Lending in smaller markets. Many national lenders do not like to lend in rural or tertiary markets. Fannie Mae is a good option for these loans.
  • Assumability and Supplemental Financing. Fannie Mae allows their loans to be assumed by a qualified borrower. They also have a program which allows borrowers the ability to come back and borrow additional funds during the life of the loan (subordinate financing).

Illinois Apartment Mortgages with Freddie Mac (FHLMC)

Freddie Mac is another government agency that provides mortgage capital in the secondary market for apartment building loans. Together, Fannie Mae and Freddie Mac control a very large portion of the multifamily market. Freddie Mac has a very aggressive program for small balance loans (from $1,000,000 to $7,500,000). Some features of this program include:

  • Market size driven. Freddie Mac classifies loans by the size of the overall market: Top, Standard, Small, and Very Small. Rates are best in top market locations (major metropolitan areas).
  • Capped costs. Freddie Mac lenders often cap the closing costs at a fixed dollar amount, thereby lowering the overall cost to borrow money.
  • Flexible pre-pay penalties. Freddie Mac offers many options for pre-payment penalties, from yield maintenance to step-down to “soft” step-down.
  • Interest-Only (I/O) loans. Freddie Mac will allow payments consisting of only interest and no amortization of principal.
  • Fixed rate terms. Freddie Mac offers fixed rates of 5, 7, and 10 years, followed by an adjustable period. These loans are called Hybrid/Adjustables. Loans have a 20 year term and a 30 year amortization schedule.

Illinois Apartment Lending with Banks and Other Programs

While the agencies (Fannie Mae and Freddie Mac) offer some excellent programs, not every apartment loan applicant qualifies for these programs. We have many excellent choices for these loans with our correspondent banks, credit unions, insurance companies and private lenders. Some examples of these loans include:

  • Loans that require flexible underwriting or those that don’t meet standardized criteria.
  • Properties in less than desirable markets, or those that require repairs or updating.
  • Properties that don’t cash flow according to industry guidelines or lack stabilized cash flow.
  • Borrowers with past credit issues, including foreclosures, short sales, or judgements.
  • Borrowers who are not US citizens.

Whether you are purchasing or refinancing, we have the right solutions available for your multifamily mortgage loans. We will entertain loan requests of all sizes, beginning at $1,000,000. Click here to get started with a free loan quote.

Illinois Multifamily Loan Information and Economic Overview

The economy of Illinois is the fifth largest in the country with a gross state product of almost $860 billion and is one of the most diversified economies globally. Illinois has a median household income of around $60,000. The Chicago metropolitan area is home to many of the country’s largest companies, including Allstate, Boeing, McDonald’s and United Airlines. 

Chicago Illinois real estate has been rated as one of the most undervalued and underrated commercial real estate markets in the country. Chicago is witnessing a building boom with over 60 cranes hovering atop new skyscrapers being built, creating an incredible amount of new business opportunities and positively impacting the market. There has never been a better time to look into commercial mortgage financing in the Chicago Illinois than right now! After the market flattened a bit last year, property rose by 5 percent in the first quarter of 2019 compared with the same period in 2018. Market research has actually shown that commercial property values were 2.5 percent higher than their pre-recession peak in 2007, leading investors to make big returns on their money.

The Illinois commercial real estate industry is being driven in part by a thriving industrial market. Due to strong economic development and a heavy demand for property geared towards internet businesses, industrial real estate vacancies are at their lowest in over 15 years! In particular, the marketplace is even tighter for investors looking for warehouse space. Even with heavy growth, commercial real estate developers are still meeting the pace of demand in Illinois. Commercial office spaces are also highly enticing investments in the current Illinois market. Office developers are pushing the boundaries of what the real estate market can handle. Even with so much new commercial office development vacancy rates in the Chicago area remain low at under 12 percent. Technology company hiring in the Chicago area is increasing demand for office space.

The multifamily and apartment sector is another great place obtain commercial mortgage financing in order to invest in Chicago commercial real estate. This year, the annual delivery volumes in Chicago reached a two-decade high with a new supply of almost 10,300 new multifamily units. Recent apartment deliveries have made up for a few years of diminishing supply volumes, ranking Chicago as one of the nation’s leaders for apartment completions since 2010. Almost 54,000 units have been completed in Chicago since the beginning of 2010, ranking the market in the #10 spot nationally for total cycle supply. The Chicago multifamily market may see slight declines over the next year in the pace of new construction and rent increases. A report by Marcus and Millichap forecasts average rent growth of just over 3% this year in the Chicago metropolitan area which is about half the rate of rent growth in 2018. It also projects that 7,800 new multifamily units will be built this year, down from the past two years. The combination of those factors should mean that apartment vacancy rates will remain relatively unchanged at a region-wide average of 5.3% making now a great time to purchase apartment and multifamily buildings. With regards to commercial mortgages, there are currently over 3.2 million mortgages for commercial real estate properties throughout the state of Illinois. The average value of these commercial mortgages is over $5.6 million, 7% above the United States average. This data demonstrates that Illinois is a very attractive place to attain a commercial mortgage loan.

Illinois Apartment Loans

Select Commercial provides apartment loans and commercial mortgages throughout the state of Illinois including but not limited to the areas below.


Chicago • Peoria • Aurora • Elgin • Rockford • Joliet • Naperville • Springfield • Peoria • Bloomington