Finally, no more debt service reserves!
November 1, 2021
Freddie Mac announces the elimination of SBL debt service reserves
COVID-19 Debt Service Reserves (DSRs), which were established to ensure the payment of principal and interest on loans collateralized by properties negatively impacted by the pandemic, are now a thing of the past for multifamily small loans. Effective today, Freddie Mac has eliminated the requirement of a 6-to-12-month DSR for loans originated through their Freddie Mac Optigo® Small Balance Loans Program.
Per Freddie Mac’s announcement, this change comes as a result of continued recovery in the multifamily market and improved performance of their small loan portfolio in terms of occupancy and rental collections. Fannie Mae announced the elimination of DSRs for all loans originated through their Small Loan Program in late May.
This announcement is another encouraging sign for the small multifamily market and competitiveness of Fannie Mae and Freddie Mac’s small loan programs heading into 2022. Here are Insights we shared on two other recent announcements also expected to have a positive impact on the programs: 130% increase to the FHFA’s housing goal related to 5-50 unit properties and $16B increase to multifamily loan purchase caps.
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With nearly 15 years of experience in finance, commercial real estate, and multifamily lending, Chris leads our MultiFi team to provide the best solutions tailored to your unique situation and goals. Chris and the MultiFi team have set out to create the future of multifamily lending, striving to empower borrowers like you with the knowledge, transparency, and expertise to get more out of your multifamily investment.
Prior to launching MultiFi, Chris was responsible for the initial underwriting and quoting of over $26 billion of potential Fannie Mae multifamily production. Chris was also instrumental in launching Berkadia’s Fannie Mae's Small Loans program and Freddie Mac’s Optigo® Small Balance Loans Program. He served as Head of Small Loan Originations, where he managed over $575 million in small loan production, in conjunction with being the Product Manager for Berkadia's multifamily lending technology initiative. Chris's unmatched experience with multifamily financing and innovation gives MultiFi an edge in providing you with the optimal solutions and experience.Read more by Chris Philipps