FNMA DUS® Stabilized Student Housing Loans 40%+ Leased to Undergraduate or Graduate Students
Refinance, Cash-Out and Purchase Loans
3.5 to 5.5% (fixed and adjustable rates)
$3,000,000 to $100 Million+
Term: 5-30 years
Amortization: 30 years
Loan to Value Maximum: 75% of appraised value
Coverage Minimum: 1.30x fixed rate/1.05x adjustable rate
Borrower: Single asset LLC, Corporation or other business entity required
Prepayment: Yield Maintenance with no lockout
3rd Party Reports: MAI appraisal, physical needs assessment, environmental Phase I required; Seismic may be required Zones 3 and 4
Accrual: 30/360 and Actual/360
Non-recourse with standard carve-outs for “bad acts” such as fraud and bankruptcy.
Escrows: Tax, insurance, funded repair and replacement escrow required based on physical needs assessment; Loans less than 65% of value with no deferred maintenance, funding of repair & replacement reserve can be waived lender discretion
Application Fee: $15,000 to cover third party reports and processing/underwriting costs
Legal Fees: $8,000 – $12,000, varying on deal characteristics
Timing: 45-60 days from application to commitment, dependent on 3rd party report timing and borrower’s submission of due diligence
Rate Lock after commitment issued; Early Rate Lock option available 1 week after application
Assumable: with lender approval of replacement borrower; Fees: 1% assumption fee to Fannie Mae including $3,000 processing fee to cover lender underwriting expenses
Ineligible: property that offers food service and/or is located on university-owned land (except for Dedicated Student Housing Property described below).
Dedicated Student Housing Specific Requirements*:
a) Near campus with 10,000+ students,
b) Within 2 miles of campus or on public/university transportation line,
c) Have operated at least 1 full school year (i.e. August/September through April/May), and
d) In 2nd full year of operations
e) 80%+ 12 months leases with parental guaranties or leased by students with financial ability to pay required rent (through employment or other documented financial means).
*Not required for student concentration below 80%
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