Written & reviewed by Stephen A. Sobin, President of Select Commercial Funding LLC
Freddie Mac Optigo Program
Freddie Mac Student Housing Value-Add Loan
The Freddie Mac Student Housing Value-Add Loan is one of the Freddie Mac multifamily (Optigo) programs Select Commercial arranges nationwide. Its highlights and terms are below, and you can compare it on our Freddie Mac multifamily page or view today’s commercial mortgage rates.
Get a Free QuoteAbout the Student Housing Value-Add Loan
Use: Generally for acquisitions and refinances of eligible Student Housing properties which need moderate upgrades of $10,000 to $25,000 per unit
Terms: 36 months with one 12-month extension (per borrower’s request) and one optional 12-month extension (per Freddie Mac’s discretion)
Interest Rate: Loans come with a floating-rate loan and full-term interest-only. There is no rate cap required.
Program Highlights & Terms
- Use: Generally for acquisitions and refinances of eligible Student Housing properties which need moderate upgrades of $10,000 to $25,000 per unit
- Terms: 36 months with one 12-month extension (per borrower’s request) and one optional 12-month extension (per Freddie Mac’s discretion)
- Interest Rate: Loans come with a floating-rate loan and full-term interest-only. There is no rate cap required.
- Maximum LTV/ Minimum DSCR: 85%/1.2x Appraisal needs to include both as-is and as-stabilized values. Additionally, underwriting must support a 75% LTV and 1.35x DSCR based on as-stabilized value
- Recourse: Non-recourse with standard carve outs for “bad boy actions”
- Prepayment Penalty: Loan is eligible to paid off at any time with a 1% penalty. No penalty if the loan is refinanced with Freddie Mac.
- Eligible Borrowers: Borrowers must have solid experience and expertise with comparable student housing deals. Guarantors must have 1.5x the standard minimum net worth and liquidity requirements.
- Other Considerations: Get Free Fredie Mac Loan Quote Loan is not assumable; No lock out period; For longer term ownership, cash-out is available assuming a completion guaranty on budgeted improvements in an amount at least equal to the cash out funds is in place
Terms are indicative and set by Freddie Mac 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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- For 5+ unit and commercial properties, $1.5M and up