American Trust Corporation

Fannie Mae DUS Multifamily Market Rate
Forward Commitment Financing - New Construction

Term & Amortization: Terms from 7 to 30 years with 30 year amortization. 30 month Forward Commitment Period with lender’s option to extend for 6 months

Loan To Value Ratio: 80% Maximum Allowable

Debt Coverage: 1.25X Minimum Allowable (1.00X for ARM Structures)

Loan Advances: Fannie Mae will advance loan funds to an approved Construction Lender, for payment of construction costs, in four equal installments at regular intervals beginning 30 days after rate lock or in a lump sum.

Rate Lock Options: Most borrowers elect to have the interest rate on the entire permanent loan locked in advance of construction by agreeing to have the full permanent loan amount advanced to the construction lender within 30 days of rate lock but other options are available that
allow for delaying the funding of advances by: (1) locking the interest rate incrementally on each of four advances funded over the first year of the commitment; (2) paying a ‘hedge fee’, either up front or as an addition to the interest rate to lock the entire rate in advance but spread the funding of advances over the first year in four equal increments; or
(3) requesting a Standby Commitment which has the lowest cost but in which the borrower assumes all interest rate risk until the property qualifies for permanent loan delivery and the interest rate is locked just prior to permanent loan closing. Standby Commitments may be converted to rate locked Forward Commitments during this term.

Mandatory Delivery: Upon acceptance of the permanent loan commitment, Borrower posts 2% in cash or an acceptable letter of credit in favor of Fannie Mae, which 2% will be refunded upon delivery of the permanent loan to Fannie Mae. Also, the Borrower must execute at
construction loan closing, a mandatory delivery promissory note in favor of Fannie Mae that obligates the Borrower to pay yield maintenance on the Fannie Mae advances if the Borrower does not convert the Forward Commitment to a permanent loan. The note is secured by a subordinate mortgage on the project, and is returned to the Borrower upon delivery of the permanent loan to Fannie Mae. (For ARM commitments, the Delivery Assurance Fee will be 5% of the Maximum Mortgage Amount.)

Prepayment: Prepayment terms, penalties, and yield maintenance requirements are specified by Fannie Mae. Typically, mortgages are subject to yield maintenance or prepayment penalties except for the 90 day period immediately prior to maturity. Consult your American Trust Corporation representative for more detail.

Features:

Non-Recourse, with the exception of standard carve-outs

Fully assumable

No rent restrictions

16-month “earn-out” provision allows mortgage to be increased after
closing based on actual performance of project

Long term fixed interest rate committed at, or prior to, construction loan closing
Eligible Properties:
The project must target 51% of units to be affordable to persons earning no more than 100% of the area median income (no rent or income restrictions).

Occupancy of 90% or higher for 3 consecutive months prior to permanent loan closing

Proven location with stable employment

Initial lease term of at least 12 months
Conversion Requirements: Forward Commitments are converted to permanent loans upon: (a) satisfactory completion of construction in accordance with plans and specifications that were independently reviewed at time of initial underwriting; (b) completion of lease-up and
stabilization as evidenced by four consecutive rent rolls, each certified and dated at one month intervals showing 90% or greater occupancy; and (c) achievement of the Net Operating Income (“NOI”) estimated in the original underwriting as evidenced by actual leases and actual operating expenses.

Requirements:

Escrow Accounts for insurance, real estate taxes, and special assessments

Replacement reserve account

Pricing: Fees and interest are quoted daily. Contact American Trust Corporation for specific pricing.

Tax-Exempt Bonds: The New Construction Product Line may be employed to credit enhance tax-exempt bonds.

Territory: Nationwide

In its pre-qualifying review, American Trust Corporation will attempt to estimate both the loan amount and the fees and costs associated with the transaction. Actual loan amounts and actual fees and expenses may vary from the pre-qualifying estimates. A pre-qualifying estimate is not a commitment to make a loan.

Application Fee: $2,500 non-refundable inspection/loan processing fee payable to American Trust Corporation with the loan application, will be credited to origination fee at closing.

Origination Fee: 1%

What We Do

Lending Programs

Property Types

Application Forms

Global Financing Solutions

Short Term Commercial

Float to Fixed

Small Loan Programs

Hard Money Loans

Credit Tenant Financing

Mezzanine

Multifamily

Office

Health Care Financing

Hotel & Resort Financing

Auto, Marine & Equipment Financing

Mobile Home Park

FHA & Fannie Mae Products

Self Storage

Retail

Industrial

SBA Programs

Factoring and Business Finance

Small and Rural Hospital Finance

Privacy Policy


	Fannie Mae DUS Multifamily Market Rate Forward Commitment Financing - New Construction Term & Amortization: Terms from 7 to 30 years with 30 year amortization. 30 month Forward Commitment Period with lender’s option to extend for 6 months Loan To Value Ratio: 80% Maximum Allowable Debt Coverage: 1.25X Minimum Allowable (1.00X for ARM Structures) Loan Advances: Fannie Mae will advance loan funds to an approved Construction Lender, for payment of construction costs, in four equal installments at regular intervals beginning 30 days after rate lock or in a lump sum. Rate Lock Options: Most borrowers elect to have the interest rate on the entire permanent loan locked in advance of construction by agreeing to have the full permanent loan amount advanced to the construction lender within 30 days of rate lock but other options are available that allow for delaying the funding of advances by: (1) locking the interest rate incrementally on each of four advances funded over the first year of the commitment; (2) paying a ‘hedge fee’, either up front or as an addition to the interest rate to lock the entire rate in advance but spread the funding of advances over the first year in four equal increments; or (3) requesting a Standby Commitment which has the lowest cost but in which the borrower assumes all interest rate risk until the property qualifies for permanent loan delivery and the interest rate is locked just prior to permanent loan closing. Standby Commitments may be converted to rate locked Forward Commitments during this term. Mandatory Delivery: Upon acceptance of the permanent loan commitment, Borrower posts 2% in cash or an acceptable letter of credit in favor of Fannie Mae, which 2% will be refunded upon delivery of the permanent loan to Fannie Mae. Also, the Borrower must execute at construction loan closing, a mandatory delivery promissory note in favor of Fannie Mae that obligates the Borrower to pay yield maintenance on the Fannie Mae advances if the Borrower does not convert the Forward Commitment to a permanent loan. The note is secured by a subordinate mortgage on the project, and is returned to the Borrower upon delivery of the permanent loan to Fannie Mae. (For ARM commitments, the Delivery Assurance Fee will be 5% of the Maximum Mortgage Amount.) Prepayment: Prepayment terms, penalties, and yield maintenance requirements are specified by Fannie Mae. Typically, mortgages are subject to yield maintenance or prepayment penalties except for the 90 day period immediately prior to maturity. Consult your American Trust Corporation representative for more detail. Features: Non-Recourse, with the exception of standard carve-outs Fully assumable No rent restrictions 16-month “earn-out” provision allows mortgage to be increased after closing based on actual performance of project Long term fixed interest rate committed at, or prior to, construction loan closing Eligible Properties: The project must target 51% of units to be affordable to persons earning no more than 100% of the area median income (no rent or income restrictions). Occupancy of 90% or higher for 3 consecutive months prior to permanent loan closing Proven location with stable employment Initial lease term of at least 12 months Conversion Requirements: Forward Commitments are converted to permanent loans upon: (a) satisfactory completion of construction in accordance with plans and specifications that were independently reviewed at time of initial underwriting; (b) completion of lease-up and stabilization as evidenced by four consecutive rent rolls, each certified and dated at one month intervals showing 90% or greater occupancy; and (c) achievement of the Net Operating Income (“NOI”) estimated in the original underwriting as evidenced by actual leases and actual operating expenses. Requirements: Escrow Accounts for insurance, real estate taxes, and special assessments Replacement reserve account Pricing: Fees and interest are quoted daily. Contact American Trust Corporation for specific pricing. Tax-Exempt Bonds: The New Construction Product Line may be employed to credit enhance tax-exempt bonds. Territory: Nationwide In its pre-qualifying review, American Trust Corporation will attempt to estimate both the loan amount and the fees and costs associated with the transaction. Actual loan amounts and actual fees and expenses may vary from the pre-qualifying estimates. A pre-qualifying estimate is not a commitment to make a loan. Application Fee: $2,500 non-refundable inspection/loan processing fee payable to American Trust Corporation with the loan application, will be credited to origination fee at closing. Origination Fee: 1%
		What We Do Lending Programs Property Types Application Forms

		Global Financing Solutions Short Term Commercial Float to Fixed Small Loan Programs Hard Money Loans Credit Tenant Financing Mezzanine Multifamily Office Health Care Financing Hotel & Resort Financing Auto, Marine & Equipment Financing Mobile Home Park FHA & Fannie Mae Products Self Storage Retail Industrial SBA Programs Factoring and Business Finance Small and Rural Hospital Finance


Privacy Policy