Anyone have with Freddie SBL loans?

Doekim's picture
Rank: Baboon | 155

I'm a doing a small personal deal and they were the most competitive. FM legal counsel called and the attorney said "I'm sending you loan docs...they're pretty much non-negotiable." I thought this was a bit strange and was wondering if anyone else has come across this loan product? Since the attorney did use the word "pretty much", I'm assuming there's some wiggle room somewhere?

Comments (7)

May 15, 2019

Hi Doekim, just trying to help:

I hope those threads give you a bit more insight.

May 18, 2019

I'm buying a 64 unit deal with some partners and financing with Freddie SBL and step down prepay at 80% LTV. It's a great program, especially if you're an investor with little or no experience owning or investing in multifamily. PM me if you'd like to discuss further...

May 18, 2019

What is the loan term? and fixed rate?

May 19, 2019

5yr IO @ 3.9%

Most Helpful
May 19, 2019

What incentive would Freddie have to negotiate on the SBL loan docs? Think of it from their perspective. They're offering financing that is superior to the rest of the market for borrowers who would generally struggle to acquire traditional debt financing from commercial banks. In addition, they have thousands---maybe tens of thousands--of these deals in the servicing portfolio. Each deal is basically a rounding error in their portfolio (even more so than their regular deals). How difficult would it be for them to provide bespoked servicing for each tiny, miniscule, irrelevant SBL transaction? They can probably barely keep their head above water as it is on the servicing side. Bespoked SBL loan docs would cause a rebellion among the servicing department.

From FM's perspective, if you don't like it then you can find financing somewhere else.

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May 19, 2019

That's essentially what they said except counsel used the phrase "pretty much" so I thought there might be some slight room.

May 20, 2019