Term Sheet (PDF)


Benefits

  • MBS execution that allows ultimate flexibility in portfolio management
  • Allows opportunistic sale or release of properties
  • Expansion feature allows easy addition of properties
  • Recognize portfolio improvements with first lien borrow-ups
  • Retain favorable interest rates with property substitutions
  • Ladder maturities with multiple tranches of debt
  • Pre-negotiated loan documents provide for certainty of execution and fast closings for facility expansions

Eligibility

  • New or repeat Fannie Mae Borrowers
  • Available for all asset classes

Credit Facility Size

Minimum initial advance of $55 million with unlimited expansion capacity.

Term

15 year Credit Facility, with 5 -15 year loan terms, available for maturity laddering.

Interest Rate

Fixed, variable, or a combination thereof. Variable-rate advances may be converted to fixed rate.

An interest rate cap or other hedging arrangement is generally required for all variable-rate advances.

Amortization

Interest-only and amortizing available, based upon property and pool performance.

Maximum LTV

Up to 80% depending upon asset class and product type.

Minimum DSCR

1.20x depending upon asset class and product type.

Structuring Options/Features

  • Single or multiple loans.
  • Single or multiple collateral pools.
  • No rebalancing required.
  • No unused capacity fees.

All structuring options/features subject to the terms of the Master Credit Facility Agreement.

Prepayment Availability

Flexible prepayment options available, including partially pre-payable debt, yield maintenance and declining prepayment premium. 

Borrower Entity

A single purpose, bankruptcy-remote entity is required for each borrower and any general partner, managing member, or sole member that is an entity. Borrowers must have common sponsorship.

Rate Lock

30- to 180-day commitments. Borrowers may lock a rate with the Streamlined Rate Lock option.

Recourse

Non-recourse execution with standard carve-outs for “bad acts” such as fraud and bankruptcy.

Escrows

Replacement reserve, tax, and insurance escrows are typically required.

Third-Party Reports

Standard third-party reports required, including Appraisal, Phase I Environmental Site Assessment, and Property Condition Assessment.

Assumption

Assumption of the entire facility is permitted upon satisfaction of the requirements of the Master Credit Facility Agreement.

Fees

Fannie Mae charges the following fees:

  • Structuring fee: 10 basis points on each advance.
  • Due Diligence fee: $1500 per property.

Other fees (e.g. substitution, release, assumption, and review) may apply.

Property Considerations

Financial and operating covenants and geographic diversity requirements determined on a case-by-case basis.