Preservation Rehabilitation Financing
TAX-EXEMPT FINANCING WITH 4% LIHTC
BORROWERS
Borrowers looking to renovate an affordable multifamily property with financing for the moderate rehabilitation of affordable properties with new Low-Income Housing Tax Credits (LIHTCs).
ELIGIBLE PROPERTY TYPES
Garden, mid-rise, or high-rise multifamily properties with new 4% Low-Income Housing Tax Credit (LIHTC) undergoing moderate rehabilitation with tenants in place.
TERMS
- Minimum term: Remaining LIHTC compliance period or 15 years, whichever is less; 15 years with HUD Risk Sharing.
- Maximum term: 35 years.
- Rehabilitation/stabilization period (maximum of 24 months) will be included in loan term.
PRODUCT DESCRIPTION
Tax-exempt financing for the moderate rehabilitation of affordable multifamily properties with a new 4% LIHTC and
tenants in place.
TYPE OF FUNDING
Tax-exempt financing for acquisition/rehabilitation based on projected post-rehabilitation net operating income (NOI); cash or letter of credit collateral required to fund gap between supportable debt on current NOI and bond mortgage loan amount (collateral held until stabilization); interest-only during the rehabilitation/stabilization period.
MINIMUM DEBT COVERAGE RATIO (DCR)[1]
- Variable rate with cap hedge: 1.20x.
- Fixed rate: 1.15x.
MAXIMUM LOAN-TO-VALUE (LTV) RATIO[1][2]
- Variable rate with cap hedge: 80% of adjusted value or 85% of market value.
- Fixed rate: 85% of adjusted value or 90% of market value.
MAXIMUM AMORTIZATION
40 years.
PREPAYMENT PROVISIONS
Fee maintenance.
SUBORDINATE FINANCING
Permitted.
TAX AND INSURANCE ESCROWS
Required.
FEES
Application fee, commitment fee, plus other fees, as applicable.
9% LIHTC CASH LOAN
BORROWERS
Borrowers looking to renovate an affordable multifamily property with financing for the moderate rehabilitation of affordable properties with new Low-Income Housing Tax Credits (LIHTCs).
ELIGIBLE PROPERTY TYPES
Garden, mid-rise, or high-rise multifamily properties with new 9% LIHTC that are undergoing moderate rehabilitation with tenants in place.
TERMS
- Minimum term: Lesser of 15 years or the remaining LIHTC compliance period; 15 years with HUD Risk Sharing.
- Maximum term: 35 years.
- Rehabilitation/stabilization period (maximum of 24 months) will be included in loan term.
PRODUCT DESCRIPTION
Financing for the moderate rehabilitation of affordable multifamily properties with a new 9% LIHTC and tenants in place.
TYPE OF FUNDING
Financing for acquisition/rehabilitation based on projected post-rehabilitation NOI; cash or letter of credit collateral required to fund gap between supportable debt on current NOI and loan amount (collateral held until stabilization); interest-only during the rehabilitation/stabilization period.
MINIMUM DEBT COVERAGE RATIO (DCR)[1]
New tax credits: 1.15x.
MAXIMUM LOAN-TO-VALUE (LTV) RATIO[1][2]
90% of market value.
MAXIMUM AMORTIZATION
40 years.
PREPAYMENT PROVISIONS
Yield maintenance.
SUBORDINATE FINANCING
Permitted.
TAX AND INSURANCE ESCROWS
Required.
FEES
Application fee, commitment fee, plus other fees, as applicable.
NON-LIHTC CASH LOAN
BORROWERS
Borrowers looking to renovate an affordable multifamily property with financing for the moderate rehabilitation of Non-LIHTC affordable properties that are rent and/or income restricted via one or more federal, state or local programs or through Freddie Mac Preservation, including affordable properties that benefit from rental assistance programs including project-based assistance, project-based vouchers and tenant-based vouchers.
ELIGIBLE PROPERTY TYPES
Garden, mid-rise, or high-rise multifamily properties undergoing moderate rehabilitation with tenants in place.
TERMS
•Minimum term: 5 years.
•Maximum term: 15 years.
•Rehabilitation/stabilization period (maximum of 24 months) will be included in loan term.
PRODUCT DESCRIPTION
Financing for the moderate rehabilitation of Non-LIHTC affordable multifamily properties that have tenants in place.
TYPE OF FUNDING
Financing for acquisition/rehabilitation based on projected post-rehabilitation NOI; cash or letter of credit collateral required to fund gap between supportable debt on current NOI and loan amount (collateral held until stabilization); interest-only during the rehabilitation/
stabilization period.
MINIMUM DEBT COVERAGE RATIO (DCR)[1]
Fixed rate: 1.25x.
MAXIMUM LOAN-TO-VALUE (LTV) RATIO[1][2]
80% of market value.
MAXIMUM AMORTIZATION
Up to 35 years, depending on the market. Please contact your relationship manager to discuss.
PREPAYMENT PROVISIONS
Yield maintenance.
SUBORDINATE FINANCING
Permitted.
TAX AND INSURANCE ESCROWS
Required.
FEES
Application fee, commitment fee, plus other fees, as applicable.
[1] Adjustments may be made depending on the property, product and/or market.
[2] Based on Appraised As-Stabilized Value.