MHN had previously reported on the impending program.<\/a><\/p>\nThe agency is partnering with experienced multifamily players to help bridge the capital gap for borrowers who need to finance or refinance overleveraged multifamily properties whose value has declined.<\/p>\n
This program is aimed at recapitalizing multifamily properties and easing the painful process of deleveraging. It is not intended to increase leverage at the property level or fuel excessive risk taking by investors.<\/p>\n
\u201cThe intent is to help the industry reduce the number of properties that may otherwise become defaults, timely workouts or foreclosures if they don\u2019t get much-needed financing,\u201d says Mike May, Freddie Mac senior vice president of Multifamily. \u201cWe are working with mezzanine providers who are experienced multifamily owners, operators, or investors to help fill the capital gap due to reduced property valuation compared to existing financing.\u201d<\/p>\n
Over the last few years, the apartment finance industry has undergone significant changes that have resulted in a capital gap for many owners. Tighter lending standards, declining property values, and fewer capital players have combined to put several apartments at risk of default at loan maturity. This program seeks to fill this gap for experienced borrowers in good standing.<\/p>\n
Freddie Mac Seller\/Servicers (multifamily lenders) will originate a first mortgage with a loan-to-value ratio (LTV) of up to 75 percent, then work with the mezzanine lender to provide additional leverage, up to another 15 percent for their borrower. This allows property owners to borrow up to 90 percent of a property\u2019s value. Freddie Mac will then purchase eligible first mortgages from its Seller\/Servicers to either retain in its portfolio or securitize into its K Certificate multifamily mortgage backed securities.<\/p>\n
The mezzanine portion of the financing is backed by the borrower\u2019s equity, not the property, so Freddie Mac is not taking on additional risk with this arrangement. The mezzanine providers also have the capability to bid on the b-piece of a Freddie Mac K Certificate if the first mortgages are securitized.<\/p>\n
Mezzanine financing is available for qualifying loans that meet the following criteria:<\/p>\n
\u00b7 Loans refinanced from either Freddie Mac or non-Freddie Mac portfolio<\/p>\n
\u00b7 Take-out of existing construction loan financing<\/p>\n
\u00b7 Acquisitions<\/p>\n
\u00b7 Properties\/assets in good physical condition and experienced sponsors<\/p>\n
\u00b7 Stabilized Class A and B conventional multifamily properties<\/p>\n
\u00b7 Capital Markets Execution loans (loans intended for Freddie Mac K Certificate multifamily mortgage-backed securities), portfolio executions and structured transactions<\/p>\n
Additional Terms<\/p>\n
\u00b7 Minimum 10 percent cash equity in the property required<\/p>\n
\u00b7 Maximum 75 percent loan-to-value (LTV) ratio on first mortgage<\/p>\n
\u00b7 Maximum 90 percent combined LTV ratio<\/p>\n
\u00b7 First mortgage must be fixed-rate<\/p>\n
\u00b7 Mezzanine debt may be fixed-rate or adjustable-rate mortgage (ARM)<\/p>\n","protected":false},"excerpt":{"rendered":"
Freddie Mac\u2019s new mezzanine financing arrangement allowing mezzanine debt on qualifying senior multifamily mortgages (first mortgages) it purchases, has now officially been launched.<\/p>\n","protected":false},"author":936,"featured_media":1004018729,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[21742],"tags":[],"class_list":["post-1004018728","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-latest"],"acf":[],"yoast_head":"\n
Freddie Launches Its Awaited Mezzanine Financing Program - Commercial Property Executive<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.commercialsearch.com\/news\/freddie-launches-its-awaited-mezzanine-financing-program\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Freddie Launches Its Awaited Mezzanine Financing Program\" \/>\n<meta property=\"og:description\" content=\"Freddie Mac\u2019s new mezzanine financing arrangement allowing mezzanine debt on qualifying senior multifamily mortgages (first mortgages) it purchases, has now officially been launched.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.commercialsearch.com\/news\/freddie-launches-its-awaited-mezzanine-financing-program\/\" \/>\n<meta property=\"og:site_name\" content=\"Commercial Property Executive\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/CPExecutive\" \/>\n<meta property=\"article:published_time\" content=\"2010-03-31T18:43:12+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2020-03-30T23:00:58+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2010\/03\/cliff1066tm1.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"500\" \/>\n\t<meta property=\"og:image:height\" content=\"333\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Allison Landa\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@cpexecutive\" \/>\n<meta name=\"twitter:site\" content=\"@cpexecutive\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/freddie-launches-its-awaited-mezzanine-financing-program\\\/#article\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/freddie-launches-its-awaited-mezzanine-financing-program\\\/\"},\"author\":{\"name\":\"Allison Landa\",\"@id\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/#\\\/schema\\\/person\\\/0eb45390ae3124c14a919b7ec7bd2249\"},\"headline\":\"Freddie Launches Its Awaited Mezzanine Financing Program\",\"datePublished\":\"2010-03-31T18:43:12+00:00\",\"dateModified\":\"2020-03-30T23:00:58+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/freddie-launches-its-awaited-mezzanine-financing-program\\\/\"},\"wordCount\":480,\"commentCount\":0,\"image\":{\"@id\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/freddie-launches-its-awaited-mezzanine-financing-program\\\/#primaryimage\"},\"thumbnailUrl\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/wp-content\\\/uploads\\\/sites\\\/46\\\/2010\\\/03\\\/cliff1066tm1.jpg\",\"articleSection\":[\"News\"],\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/freddie-launches-its-awaited-mezzanine-financing-program\\\/#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/freddie-launches-its-awaited-mezzanine-financing-program\\\/\",\"url\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/freddie-launches-its-awaited-mezzanine-financing-program\\\/\",\"name\":\"Freddie Launches Its Awaited Mezzanine Financing Program - Commercial Property Executive\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/freddie-launches-its-awaited-mezzanine-financing-program\\\/#primaryimage\"},\"image\":{\"@id\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/freddie-launches-its-awaited-mezzanine-financing-program\\\/#primaryimage\"},\"thumbnailUrl\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/wp-content\\\/uploads\\\/sites\\\/46\\\/2010\\\/03\\\/cliff1066tm1.jpg\",\"datePublished\":\"2010-03-31T18:43:12+00:00\",\"dateModified\":\"2020-03-30T23:00:58+00:00\",\"author\":{\"@id\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/#\\\/schema\\\/person\\\/0eb45390ae3124c14a919b7ec7bd2249\"},\"breadcrumb\":{\"@id\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/freddie-launches-its-awaited-mezzanine-financing-program\\\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/freddie-launches-its-awaited-mezzanine-financing-program\\\/\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/freddie-launches-its-awaited-mezzanine-financing-program\\\/#primaryimage\",\"url\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/wp-content\\\/uploads\\\/sites\\\/46\\\/2010\\\/03\\\/cliff1066tm1.jpg\",\"contentUrl\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/wp-content\\\/uploads\\\/sites\\\/46\\\/2010\\\/03\\\/cliff1066tm1.jpg\",\"width\":\"500\",\"height\":\"333\",\"caption\":\"Courtesy Flickr Creative Commons user cliff1066tm\"},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/freddie-launches-its-awaited-mezzanine-financing-program\\\/#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"Freddie Launches Its Awaited Mezzanine Financing Program\"}]},{\"@type\":\"WebSite\",\"@id\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/#website\",\"url\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/\",\"name\":\"Commercial Property Executive\",\"description\":\"\",\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/?s={search_term_string}\"},\"query-input\":{\"@type\":\"PropertyValueSpecification\",\"valueRequired\":true,\"valueName\":\"search_term_string\"}}],\"inLanguage\":\"en-US\"},{\"@type\":\"Person\",\"@id\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/#\\\/schema\\\/person\\\/0eb45390ae3124c14a919b7ec7bd2249\",\"name\":\"Allison Landa\",\"image\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\\\/\\\/secure.gravatar.com\\\/avatar\\\/1c0d6eca27abba0e62d2fd20a5e74bf2e8f124942225edf677a907fb2c5acef5?s=96&d=mm&r=g\",\"url\":\"https:\\\/\\\/secure.gravatar.com\\\/avatar\\\/1c0d6eca27abba0e62d2fd20a5e74bf2e8f124942225edf677a907fb2c5acef5?s=96&d=mm&r=g\",\"contentUrl\":\"https:\\\/\\\/secure.gravatar.com\\\/avatar\\\/1c0d6eca27abba0e62d2fd20a5e74bf2e8f124942225edf677a907fb2c5acef5?s=96&d=mm&r=g\",\"caption\":\"Allison Landa\"},\"url\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/author\\\/allisonlanda\\\/\"}]}<\/script>\n<!-- \/ Yoast SEO Premium plugin. -->","yoast_head_json":{"title":"Freddie Launches Its Awaited Mezzanine Financing Program - Commercial Property Executive","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/www.commercialsearch.com\/news\/freddie-launches-its-awaited-mezzanine-financing-program\/","og_locale":"en_US","og_type":"article","og_title":"Freddie Launches Its Awaited Mezzanine Financing Program","og_description":"Freddie Mac\u2019s new mezzanine financing arrangement allowing mezzanine debt on qualifying senior multifamily mortgages (first mortgages) it purchases, has now officially been launched.","og_url":"https:\/\/www.commercialsearch.com\/news\/freddie-launches-its-awaited-mezzanine-financing-program\/","og_site_name":"Commercial Property Executive","article_publisher":"https:\/\/www.facebook.com\/CPExecutive","article_published_time":"2010-03-31T18:43:12+00:00","article_modified_time":"2020-03-30T23:00:58+00:00","og_image":[{"width":500,"height":333,"url":"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2010\/03\/cliff1066tm1.jpg","type":"image\/jpeg"}],"author":"Allison Landa","twitter_card":"summary_large_image","twitter_creator":"@cpexecutive","twitter_site":"@cpexecutive","schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"Article","@id":"https:\/\/www.commercialsearch.com\/news\/freddie-launches-its-awaited-mezzanine-financing-program\/#article","isPartOf":{"@id":"https:\/\/www.commercialsearch.com\/news\/freddie-launches-its-awaited-mezzanine-financing-program\/"},"author":{"name":"Allison Landa","@id":"https:\/\/www.commercialsearch.com\/news\/#\/schema\/person\/0eb45390ae3124c14a919b7ec7bd2249"},"headline":"Freddie Launches Its Awaited Mezzanine Financing Program","datePublished":"2010-03-31T18:43:12+00:00","dateModified":"2020-03-30T23:00:58+00:00","mainEntityOfPage":{"@id":"https:\/\/www.commercialsearch.com\/news\/freddie-launches-its-awaited-mezzanine-financing-program\/"},"wordCount":480,"commentCount":0,"image":{"@id":"https:\/\/www.commercialsearch.com\/news\/freddie-launches-its-awaited-mezzanine-financing-program\/#primaryimage"},"thumbnailUrl":"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2010\/03\/cliff1066tm1.jpg","articleSection":["News"],"inLanguage":"en-US","potentialAction":[{"@type":"CommentAction","name":"Comment","target":["https:\/\/www.commercialsearch.com\/news\/freddie-launches-its-awaited-mezzanine-financing-program\/#respond"]}]},{"@type":"WebPage","@id":"https:\/\/www.commercialsearch.com\/news\/freddie-launches-its-awaited-mezzanine-financing-program\/","url":"https:\/\/www.commercialsearch.com\/news\/freddie-launches-its-awaited-mezzanine-financing-program\/","name":"Freddie Launches Its Awaited Mezzanine Financing Program - Commercial Property Executive","isPartOf":{"@id":"https:\/\/www.commercialsearch.com\/news\/#website"},"primaryImageOfPage":{"@id":"https:\/\/www.commercialsearch.com\/news\/freddie-launches-its-awaited-mezzanine-financing-program\/#primaryimage"},"image":{"@id":"https:\/\/www.commercialsearch.com\/news\/freddie-launches-its-awaited-mezzanine-financing-program\/#primaryimage"},"thumbnailUrl":"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2010\/03\/cliff1066tm1.jpg","datePublished":"2010-03-31T18:43:12+00:00","dateModified":"2020-03-30T23:00:58+00:00","author":{"@id":"https:\/\/www.commercialsearch.com\/news\/#\/schema\/person\/0eb45390ae3124c14a919b7ec7bd2249"},"breadcrumb":{"@id":"https:\/\/www.commercialsearch.com\/news\/freddie-launches-its-awaited-mezzanine-financing-program\/#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/www.commercialsearch.com\/news\/freddie-launches-its-awaited-mezzanine-financing-program\/"]}]},{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/www.commercialsearch.com\/news\/freddie-launches-its-awaited-mezzanine-financing-program\/#primaryimage","url":"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2010\/03\/cliff1066tm1.jpg","contentUrl":"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2010\/03\/cliff1066tm1.jpg","width":"500","height":"333","caption":"Courtesy Flickr Creative Commons user cliff1066tm"},{"@type":"BreadcrumbList","@id":"https:\/\/www.commercialsearch.com\/news\/freddie-launches-its-awaited-mezzanine-financing-program\/#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/www.commercialsearch.com\/news\/"},{"@type":"ListItem","position":2,"name":"Freddie Launches Its Awaited Mezzanine Financing Program"}]},{"@type":"WebSite","@id":"https:\/\/www.commercialsearch.com\/news\/#website","url":"https:\/\/www.commercialsearch.com\/news\/","name":"Commercial Property Executive","description":"","potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/www.commercialsearch.com\/news\/?s={search_term_string}"},"query-input":{"@type":"PropertyValueSpecification","valueRequired":true,"valueName":"search_term_string"}}],"inLanguage":"en-US"},{"@type":"Person","@id":"https:\/\/www.commercialsearch.com\/news\/#\/schema\/person\/0eb45390ae3124c14a919b7ec7bd2249","name":"Allison Landa","image":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/secure.gravatar.com\/avatar\/1c0d6eca27abba0e62d2fd20a5e74bf2e8f124942225edf677a907fb2c5acef5?s=96&d=mm&r=g","url":"https:\/\/secure.gravatar.com\/avatar\/1c0d6eca27abba0e62d2fd20a5e74bf2e8f124942225edf677a907fb2c5acef5?s=96&d=mm&r=g","contentUrl":"https:\/\/secure.gravatar.com\/avatar\/1c0d6eca27abba0e62d2fd20a5e74bf2e8f124942225edf677a907fb2c5acef5?s=96&d=mm&r=g","caption":"Allison Landa"},"url":"https:\/\/www.commercialsearch.com\/news\/author\/allisonlanda\/"}]}},"jetpack_featured_media_url":"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2010\/03\/cliff1066tm1.jpg","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/www.commercialsearch.com\/news\/wp-json\/wp\/v2\/posts\/1004018728","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.commercialsearch.com\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.commercialsearch.com\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.commercialsearch.com\/news\/wp-json\/wp\/v2\/users\/936"}],"replies":[{"embeddable":true,"href":"https:\/\/www.commercialsearch.com\/news\/wp-json\/wp\/v2\/comments?post=1004018728"}],"version-history":[{"count":4,"href":"https:\/\/www.commercialsearch.com\/news\/wp-json\/wp\/v2\/posts\/1004018728\/revisions"}],"predecessor-version":[{"id":1004404433,"href":"https:\/\/www.commercialsearch.com\/news\/wp-json\/wp\/v2\/posts\/1004018728\/revisions\/1004404433"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.commercialsearch.com\/news\/wp-json\/wp\/v2\/media\/1004018729"}],"wp:attachment":[{"href":"https:\/\/www.commercialsearch.com\/news\/wp-json\/wp\/v2\/media?parent=1004018728"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.commercialsearch.com\/news\/wp-json\/wp\/v2\/categories?post=1004018728"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.commercialsearch.com\/news\/wp-json\/wp\/v2\/tags?post=1004018728"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}![\"\"](\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2010\/03\/cliff1066tm1.jpg\" "\\"cliff1066tm\\"")
<\/a>