Fannie Mae Green Financing

BENEFITS

  • Pricing incentive of 22-30 bps interest rate reduction from standard Fannie Mae DUS® rates
  • Higher LTV and lower DSCR for Green Preservation Plus loans
  • Increased cash flow with reduced energy expenses, lower water costs, and new revenue from electricity-generating solar systems
  • Access to broader MBS investor market interested in Fannie Mae’s environmentally-focused Green MBS
  • Up to 5% higher loan proceeds to finance energy- and water-saving property improvements with Green Rewards and Green Preservation Plus

REQUIREMENTS

There are three types of Green Financing Products:

Green Building Certification

  • Conventional and Affordable Multifamily Properties are eligible
  • Property must possess a current Fannie Mae recognized Green Building Certification prior to rate lock
  • ENERGY STAR Reporting required

Green Rewards

  • Conventional and Affordable Multifamily Properties are eligible
  • Portion of proceeds must finance green property improvements
  • Up to 50% of projected energy and water cost savings may be included in NOI calculation, including tenant savings up to 25% of the total projected energy and water savings
  • Fixed or adjustable rate
  • Improvements must be made within 12 months of closing Replacement reserves, taxes and insurance escrows are required
  • ENERGY STAR Reporting required

Green Preservation Plus

  • Affordable Multifamily Properties are eligible
  • Energy- and water-saving improvements must equal at least 5% of the loan amount 5% higher than applicable LTV limitation for the loan
  • 5 bps lower than the applicable DSCR requirement for the loan Fixed rate only
  • Improvements must be made within 12 months of closing
  • Replacement reserves, taxes and insurance escrows are required
  • ENERGY STAR Reporting required

IMPROVEMENT EXAMPLES

  • Low-flow plumbing fixtures
  • Solar panels
  • Energy-efficient lighting and/or windows and/or insulation
  • ENERGY STAR® appliances

*Please note the pricing incentive reduction range is indicative as of the date appearing below and will change from time to time. Effective date 04/06/2016.