077: Fannie-Freddie: King and Queen of Permanent Financing for Multifamily Deals

Jun 11, 2019

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You know me, I know how and where to find the cheapest place possible for banking, lending, and fat stacks of cash for multifamily deals.

Today, my guest is Aaron Moll, a mortgage banker at Berkadia. He’s done more than a billion dollars in loans and covers the whole lending spectrum. However, Aaron specializes in student housing loans, including getting me two loans for student housing projects.

Topics on Today’s Episode:

Agency vs. Non-agency: Comparing options for getting loans for bigger deals
Supplemental Financing: Biggest advantage with Fannie Mae and Freddie Mac
Exit Plan: How do you exit money at the right time?
Guidelines, Rules, and Reviews: Are Freddie Mac, Fannie Mae, Delegated Underwriting and Servicing (DUS) even options for multifamily deal?
Seek small balance loan to streamline process and for low-cost and expedited transactions; designed for $5 million or less loans with DUS rules
Fannie Mae and Freddie Mac offer step-down fee structure to create loans that match client’s specific needs
Definition of Defeasance: Standard prepayment on permanent debt by securitizing deal
Pros and cons of HUD loans include taking six months to close, amount of paperwork to complete, extra cost, and extremely low-interest rates
Local banks are needed for loans, but so are mortgage brokers to reduce contingent liabilities and find something in the marketplace that fits your goals
Loans should not be the same for every deal; utilize different plans of action, execution, hold periods, and other factors
Not all lenders are the same; bridge market is partnership program in competitive space with interest-only payment, not a recourse
Mortgage brokers build relationships to bring lenders and borrowers together

Links and Resources Mentioned:

Quotes:

“Fannie-Freddie: King and Queen of multifamily. They tend to lead the pack when it comes to permanent financing. If you’re a masochist, we have HUD loans.” Aaron Moll

“Fannie-Freddie give you, programmatically, supplemental loans. You get one more bite at the apple during your 10-year term.” Aaron Moll

“When you do apartment deals, and you have equity involved, and you’re syndicating, it’s always about the exit." Corey Peterson

“We try to marry up the debt to best secure cash returns. That’s what everybody’s in this game for, is to make some money.” Aaron Moll

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