Illinois Apartment Loans

$1,000,000 Minimum

Illinois Apartment Loan Rates - Rates updated October 20th, 2021

Illinois Apartment Loan Programs Over $6,000,000 Rates (start as low as) LTV
Multifamily 5 Year Fixed Loan Rates 2.59% Up to 80% Get Free Quote
Multifamily 7 Year Fixed Loan Rates 2.70% Up to 80% Get Free Quote
Multifamily 10 Year Fixed Loan Rates 2.91% Up to 80% Get Free Quote
Illinois Apartment Loan Programs Under $6,000,000 Rates (start as low as) LTV
Multifamily 5 Year Fixed Loan Rates 3.23% Up to 80% Get Free Quote
Multifamily 7 Year Fixed Loan Rates 3.24% Up to 80% Get Free Quote
Multifamily 10 Year Fixed Loan Rates 3.26% 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 2.59% (as of October 20th, 2021)
• 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

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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

Chicago 2021 Apartment Market and Trends

Rental demand in Chicago’s urban core significantly decreased in 2020, as businesses shut down or had employees work from home during COVID-19. Many people looked for less expensive and larger homes outside of the urban center that could accommodate remote work. In specific, rental demand in the Stree­terville-River North and the Loop areas went down the most. These two markets each received more than 2,000 new multifamily units in 2020. Given the lower demand, vacancy soared around 400 basis points to metro highs in each market. In 2021, experts anticipate an improvement in rental demand due to both a slower delivery pace and widespread vaccinations that allow workers to return to offices.

During COVID-19, the suburban markets of Chicago actually did quite well. Unemployment caused many renters to look for cheaper housing, and many people working for home sought larger apartments in the suburbs. Vacancies decreased by over 100 basis points in the Will County and Mer­rillville-Portage-Valparaiso submarkets. In fact, South Cook County had the city’s lowest vacancy rate of 2.8 percent, a reduction of 70 basis points year over year. Experts have said that with a downtown revival in Chicago, additional investors will be drawn to multifamily assets in the city in 2021.

In 2021, there is expectation that employment should grow about 2.6 percent in the city. However, the total employment level will remain more than 200,000 jobs below the pre-Covid-19 pandemic level. Therefore, Chicago’s unemployment rate in 2021, which sat at 8.2 percent at the end of 2020, is likely to stay above the national rate. In 2021, deliveries are expected to decrease to the lowest level in more than five years. Total inventory is expected to expand by only 0.8 percent in 2021. This is down from a 1.1 percent gain last year. The majority of the rentals due in 2021 are located in the suburbs. Following a slow absorption pace in 2020, Demand for rentals is set to outpace inventory additions in 2021. This should lead to a contracting of the vacancy rate down to 5.3 percent in 2021. This is a significant improvement from last year when the vacancy rate jumped 100 basis points. A growing demand for apartments in Chicago in 2021 is set to push rents higher. By the end of 2021, the average effective rent in Chicago is expected to sit at $1,498 per month. While the rate is up year over year, it remains below the recent peak of $1,580 achieved during 2019.

2021 Multifamily Outlook

  • Employment in the US is expected to show a 4.6% year over year increase with the creation of 6.5 million new jobs in 2021 which represents the largest annual increase in over three decades.  This is the result of businesses emerging from the Covid-19 pandemic.  Unfortunately, the US lost close to 9.4 million jobs during the pandemic.
  • Strong demand for apartments, as a result of increased employment rates, is expected to push national vacancy rates down to 3.9%, down from 4.4% in 2021.
  • Construction of new apartments in 2021 are expected to top 385,000 new units, an increase of 2.1% over last year’s record pace.  Rising labor and construction costs are starting to have an effect on new construction, however.
  • Following rent declines during the pandemic, average rental rates are expected to rise 6.8% in 2021 to $1,507 per month.  Landlords are able to raise rents dramatically due to decreased vacancy rates and the strong demand got rental housing.
  • The COVID-19 pandemic affected the ability of young graduates to find jobs and move into apartments of their own.  The demand for apartment rentals is usually fueled by young graduates entering the workforce and moving into rental apartments.  Many young adults lived with their parents or friends during the pandemic and into early 2021.  As 2021 progressed, many companies reopened their offices and began hiring again which generated record levels of new apartment rentals.  This trend should continue through late 2021 as more new workers are able find jobs and move into their own apartments.  Many of these new multifamily units are in metro areas of the sunbelt states as workers have been moving out of colder urban areas in favor of more suburban warmer climates.

    The tight market in 2021 for new home purchases has caused many would be homebuyers to continue renting.  Prices for existing homes have risen due to lack of inventory and the cost of construction has skyrocketed due to increased costs for raw materials.  The high cost of purchasing a new or existing home is keeping the demand for rental units very strong in 2021.

    During the pandemic, when workers were either out of work or working from home, many people moved out of densely populated urban areas in favor of suburban locations.  In 2021, as more employees are returning to their offices, we are seeing demand pick up once again for rental apartments in urban locations.  In addition, as more and more retail and dining locations reopen in downtown areas, we expect to see a return of employees to these areas.

    During the pandemic, the CDC and local governments instituted a moratorium of evictions.  This caused many landlords to suffer economic losses and depressed the value of apartment properties.  In 2021, as these moratoriums start to expire, we expect to see strong demand from investors for these properties.

    Nationwide, the first half of 2021 saw more than 175,000 new apartments completed and a total of 363,000 for the previous 12 months.  A high percentage of these new units were in Texas and other sunbelt states, as more and more people are relocating to warmer climates.  Occupancy rates and asking rents have been lower in larger urban markets in the Northeast and other colder climates, while occupancy rates and asking rents have been increasing in these warmer sunbelt climates.  These 2021 trends have definitely been driven by the COVID-19 pandemic and we are watching these trends closely to see if these trends persist after the pandemic is over.

    Illinois Multifamily Loan Information and Economic Overview

    Chicago Economic Trends Chicago Economic Trends

    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.

    2020 Chicago Apartment Market Forecast

    Chicago Completions vs. Absorption Chicago Completions vs. Absorption

    Chicago’s National Multifamily Index Rank is at 37, down 9 places. Diminishing overall employment gains and rising property taxes contribute to Chicago’s reduced standing in this year’s National Multifamily Index.

    Employment in Chicago is up 0.6%. Hiring activity will continue to slow this year as 30,500 workers are added to payrolls. Last year, 33,000 jobs were created.

    Construction of new apartment units in Chicago is expected to exceed 7.400 units. Completions will decrease after 9,100 units were delivered last year, with the urban core logging the majority of new supply.

    The vacancy rate in Chicago is down 10 bps. The absorption of nearly 7,800 units will push market vacancy down to 4.8 percent this year. This builds on 60- and 40-basis- point drops during the previous two years.

    Rent in Chicago is up 5.1%. Coming in just under the previous three-year average, rents will continue to advance, lifting the average effective rent up to $1,663 per month.

    Investment in the Chicago apartment and multifamily market remains promising for those looking for multifamily loans. Large-scale mixed-use projects coming to fruition in the near future will continue to spur new investment opportunities in adjacent areas, further strengthening bidding environments. Investors would be wise to look into procuring an apartment loan for their next purchase in the Chicago metro.

    Data provided by Marcus & Millichap.

    Chicago Vacancy and Rents Chicago Vacancy and Rents

    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.

    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.


    Fannie Mae Loan and Rate Information


    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 apartment 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).

    Freddie Mac Loan and Rate Information

    Freddie Mac Multifamily Loans provide 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. Get started with a Free Commercial Mortgage 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 • RockfordJolietNaperville • Springfield • Peoria • Bloomington