FREDDIE MAC® Student Housing

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Arbor’s Student Housing product provides attractive terms and competitive prices for the purchase or refinance of properties that, because of construction and location, specifically cater to a student tenant base and may or may not be readily convertible to conventional multifamily housing.

Loan Amount $5,000,000 minimum
Amortization 5 to 10 years. Up to 30 years for fixed-rate loans if loan is not purchased for securitization. Interest-only options available.
Minimum DSC 1.30 / 1.35 if cash-out. Refer to: for grid.
Maximum LTV 80%. Refer to: for grid.
Rate Structure Fixed- and floating-rate options available.
Eligible Property Types Specifically cater to a student tenant base. Not readily convertible to conventional multifamily housing. Must be greater than 50% student occupied. 12-month leases and parental guarantees are preferred. Food services not permitted. Must have minimum of 1 bathroom for every 2 bedrooms, and each apartment must have a separate full kitchen. Property must be located less than 2 miles from campus or on bus route.
Occupancy Requirement 90% physical occupancy for a minimum of 90 consecutive days prior to loan closing and as of the delivery date.
Tax and Insurance Escrows Monthly deposits required. May be waived if certain criteria are met.
Replacement Reserves Underwritten at a minimum of $150 per bedroom or $350 per unit per annum. Must be funded.
Recourse Non-recourse with standard exceptions, including for fraud and misrepresentation
Commercial Space No more than 20% of effective gross income and no more than 20% of property’s total square footage
Student Population Requirement Minimum 8,000 students
Required Reports Appraisal, Properly Condition Assessment and Phase I Environmental, Zoning, Insect and Flood
Prepayment Defeasance for fixed-rate loans. Four main prepayment options available for floating-rate loans. No premium for final 90 days.
Assumable Subject to approval and 1% fee.
Subordinate Financing Not allowed
Supplemental Loans Available Subject to requirements in the Loan Agreement and Freddie Mac
Pricing Tiered Pricing Matrix. More favorable terms available for higher DSC and lower LTV.
Rate Lock Standard 5-day rate-lock period. Early Rate Lock, Fast-Track Early Rate Lock and Index Lock options available.
Application Deposit $12,500. Covers all estimated underwriting costs (including application fee).
Legal / Closing Fee Arbor’s Counsel Fee to be determined at application
Good Faith Deposit 2% of loan amount due at rate lock for early rate-lock transactions refundable post-closing
Arbor Commercial Mortgage | | 800.ARBOR.10