Adjustable Rate Apartment Loan

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ELIGIBLE PROPERTIES:
Apartments which are existing or recently completed (either newly constructed or substantially rehabilitated). Properties must have a minimum occupancy of 90% at the time of commitment and the preceding three-month period.

LOAN TYPE:
Adjustable-rate balloon mortgages with a 5, 7 or 10-year term.

PREFERRED LOAN SIZE:
$10 million and larger.

MAXIMUM LOAN:
Amount equal to the lesser of:
80% of appraised value (75% for 5-year terms); or
1.00 debt service coverage using the underwriting rate. The underwriting rate is equal to the note rate plus the Lifetime Interest Rate Cap.
100% of fixed-rate loan for same term.

INTEREST RATES:
Determined by the market rates at the time of rate lock. Rates vary by loan-to-value ratio, debt service coverage and property quality.

RATE ADJUSTMENT PARAMETERS:
Variety of lifetime Interest Rate Cap and Floor options.*
*The Interest Rate Cap does not have to be purchased and is already built into the pricing.

AMORTIZATION:
Up to 30 years.

PERSONAL RECOURSE:
None, except for standard exceptions to non-recourse, which are the responsibility of the Key Principal(s).

ASSUMABILITY:
Assumable, subject to Walker & Dunlop approval and a 1% transfer fee.

PREPAYMENT:
No prepayment allowed for the first year; thereafter, either 1% or fixed declining prepayment options.

CONVERSION OPTION:
If borrower chooses conversion option, the loan can convert to a new 7-year or 10-year fixed-rate loan. This conversion is available during loan years 2 through 5.

SUBORDINATE FINANCING:
Fannie Mae Supplemental Loans (second mortgages) available 12 months after initial loan closing.
Supplemental loans can be provided on a fixed or adjustable-rate basis.

ESCROWS:
125% to 150% of estimated cost of required repairs, if any, as determined by the physical inspection.
Monthly escrows for real estate taxes, property insurance and replacement reserve.

APPLICATION FEE:
Based on estimated underwriting costs for appraisal, architectural / engineering report, environmental assessment and other loan processing costs.

FINANCING FEE:
Negotiable.

CLOSING EXPENSES:
Standard transaction costs, including legal fees, title insurance and survey.

PRELIMINARY SUBMISSION PACKAGE:

Include the following in your request for a loan quote:

  • Property description and location map.
  • Representative color photographs.
  • Current rent roll and trailing 12-month operating statement with monthly detail.
  • Operating history – prior 3 years, if available.
  • Current year operating budget.
  • Existing debt and cost basis.
  • Sponsor resume.

This is a summary of general program terms, which are subject to change. This is not a commitment to lend.