Flexible Choice Bridge

We offer three variable rate financing options for Multifamily Affordable Properties: the ARM 7/6™ Loan, the Structured ARM (SARM) Loan, and the ARM 5/5 Loan, each of which offers a fixed rate conversion feature.

Competitive Advantage (PDF)   


  • Re-syndication solution
  • Interest-only options available
  • Interest rate cap options
  • Attractive, low-cost acquisition solution for preservation of Multifamily Affordable Properties
  • Convertible to fixed rate


  • Existing, stabilized Multifamily Affordable Housing Properties


5 or 7 years (10 year SARM Loan option also available).

Loan Size

No minimum or maximum loan amount.(Except SARM Loans that are not re-syndication transactions, which must be $5 million or greater).

Mortgage Loan amount shall not exceed that of a fixed rate Mortgage Loan with similar terms.


Up to 30 years

Maximum LTV

Up to 80%

Minimum DSCR

ARM 7/6 Loan and ARM 5/5 Loan: 1.00x using the maximum lifetime interest rate.

SARM Loans: 1.00x using a variable underwriting rate equal to the sum of (i) the Index, plus (ii) the Investor spread, Guaranty Fee, and Servicing Fee (the “Margin”), plus (iii) the interest rate cap escrow expressed as a percentage (if the cap term is shorter than the loan term), plus (iv) 3%, plus (v) the amortizing constant for that built-up rate.

Prepayment Availability

No prepayment permitted during the Lockout Period (typically, the first Loan Year); prepayment permitted thereafter with a 1% prepayment premium. No prepayment premium is charged during the "open period" (typically, the last 3 months of the Mortgage Loan term).

SARM Loans also offer the option of a one-year lock-out, then declining prepayment premium of 4% in the second year, 3% in the third year, 2% in the fourth year, and 1% thereafter. 

Interest Rate Adjustments

Adjusts based on changes to the underlying Index and is equal to the Index plus the Margin. A SARM Loan has no limit on rate changes that may occur over the Mortgage Loan term.

Rate Lock

Maximum 30-day commitment available.


30-Day Average SOFR.

Interest Rate Cap

ARMs 7/6™ Loans have a maximum monthly interest rate adjustment of plus or minus 1%. The maximum lifetime interest rate to the Borrower is capped at 6%, plus the Guaranty Fee, plus the Servicing Fee.

ARM 5/5 Loans have a maximum monthly interest rate adjustment of plus or minus 1%. The maximum lifetime interest rate to the Borrower is capped at 5%, plus the Guaranty Fee, plus the Servicing Fee.

SARM Loans have no built-in periodic or lifetime caps. Instead, the Borrower must purchase an Interest Rate Cap from an approved Interest Rate Cap provider, with a minimum initial cap term of 5 years.

Interest Rate Floor

The interest rate shall never be less than the Margin.

Conversion to Fixed Rate

Adjustable rate Mortgage Loans have a conversion feature whereby the interest rate may be converted to a 7- or 10-year fixed rate Mortgage Loan on any rate change date after the required Lockout Period (typically the first Loan Year ) and before the start of the "open period" (typically the last day of the 4th month preceding the end of the Mortgage Loan term), provided the Mortgage Loan has not been delinquent during the previous 12 months and the Borrower is not in default under any Loan Document.

  • No prepayment premium charged at the time the ARM Loan converts to a fixed rate Mortgage Loan.
  • Minimal re-underwriting; Lender must determine that the current Net Cash Flow can support the new fixed rate Mortgage Loan terms.
  • No increase in the loan amount; Mortgage Loan may be eligible for a Supplemental Mortgage Loan.




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


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.

Flexible Choice Bridge

Six Month Lockout Option FAQs

More information on the alternative six-month lock-out option.

Read More