Expanded Rate Buydown Options

Fannie Mae has expanded its interest rate buydown options to allow borrowers to reduce their loan interest rate through larger upfront contributions that are incorporated into the loan structure. This allows lenders to structure more competitive loan options while streamlining the approval process. 

Fannie Mae’s expanded buydown options provide lenders with added flexibility to structure competitive multifamily financing solutions for borrowers. Through the Delegated Underwriting and Servicing (DUS®) model, lenders can incorporate buydowns across both fixed- and variable-rate loan structures, helping borrowers manage interest rate exposure and align financing terms with their investment strategy.

Compared with other multifamily financing options in the market, Fannie Mae’s approach emphasizes flexibility, lender discretion, and streamlined execution within the DUS network. This enables lenders to deliver tailored loan structures that meet borrowers’ needs while supporting liquidity and stability in the multifamily market.

 The expanded options are available for eligible Fannie Mae Multifamily loans that meet standard program and underwriting requirements.

Yes. The expanded rate buydown options are available for MHC and other Multifamily loan types, with no additional limitations beyond standard program requirements.

No. There are no tier‑based limitations specific to the expanded rate buydown options.

Expanded rate buydowns apply to fixed‑rate Multifamily loans with amortization periods of up to 35 years.

Yes. Loans using expanded rate buydown options remain subject to Fannie Mae’s standard LTV limits as outlined in the Multifamily Selling and Servicing Guide and Pricing Memo. 

The expanded options allow borrowers to access lower interest rates through upfront contributions, which may also support increased loan proceeds within established delivery tolerances.

Eligible rate buydown transactions may be executed on a fully delegated basis, supporting a more streamlined and efficient process.

An upfront interest‑rate buydown may cause a security to be issued with Original Issue Discount (OID) which may trigger OID tax reporting. Investors should consult their tax advisors and the Additional Disclosure section of the Prospectus regarding OID considerations.

Additional details, eligibility requirements, and program guidance are available in the Fannie Mae Multifamily Selling and Servicing Guide, the Pricing Memo and through Fannie Mae Multifamily representatives.