Written & reviewed by Stephen A. Sobin, President of Select Commercial Funding LLC
Fannie Mae Program
Fannie Mae Reduced Occupancy Affordable Rehab (ROAR) Loan
The Fannie Mae Reduced Occupancy Affordable Rehab (ROAR) Loan is one of the Fannie Mae multifamily programs Select Commercial arranges nationwide. Its highlights and terms are below, and you can compare it on our Fannie Mae multifamily page or view today’s commercial mortgage rates.
Get a Free QuoteAbout the Reduced Occupancy Affordable Rehab (ROAR) Loan
The Fannie Mae ROAR loan provides permanent financing for affordable housing property in need of renovation, with interest-only during the rehab period and increased leverage as loans are underwritten to as-improved rents, a more efficient alternative to standard construction loans or forward commitments.
Program Highlights & Terms
- Property & Sponsor Eligibility: Existing, stabilized affordable housing undergoing renovations; borrower with demonstrated experience; acquisition and refinance; renovations up to $120,000 per unit
- Loan Size: Minimum of $5 million
- Term: 5 to 30 years
- Amortization: Up to 35 years
- Interest Rate: Both fixed and variable-rate options available
- Maximum LTV: Up to 90% based on stabilized value
- Minimum DSCR: 1.15x based on stabilized rents
- Prepayment Penalty: Flexible options including yield maintenance and declining premium
- Rehab Period: 12 to 15 months
- Rehab Period Terms: Occupancy may drop to 50% during rehab; DSCR may drop to 1.0x (interest-only) or 0.75x (amortizing); rehab funds escrowed; property must be fully stabilized no later than 15 months after origination
Terms are indicative and set by Fannie Mae underwriting for your specific property.
What Our Clients Say
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Nathan B. · Philadelphia, PA“Select Commercial was very helpful with my multifamily mortgage. Stephen went over several options and we came up with the best lender to meet my needs. I got the funds and also lowered my payments.”
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