Freddie Mac extends loan forbearance period on multifamily landlords

The mortgage agency, which also tightened eviction restrictions, reported 105 borrowers with $810M in loans sought relief in program’s first week

TRD NATIONAL /
Apr.April 15, 2020 05:26 PM
Freddie Mac CEO David Brickman

Freddie Mac CEO David Brickman

Freddie Mac is extending the forbearance period for multifamily borrowers and beefing up the eviction ban requirement for landlords who receive the relief.

The program, which offers landlords forbearance on multifamily loans if they can show coronavirus-related hardship, will be extended to the end of the year or the end of the federal emergency period, whichever is sooner. Borrowers may apply for forbearance up to the end of the program, which had been scheduled to expire Aug. 1.

In the program’s first week, 105 borrowers requested relief on $810.2 million in multifamily mortgages, according to Fitch Ratings. None of those loans was transferred to special servicing.

Freddie Mac is also broadening the no-eviction requirement. Now, landlords cannot evict a tenant for nonpayment during the forbearance period, even if the tenant is unable to demonstrate financial hardship due to the coronavirus.

The agency also made clear that while mortgage payments are postponed, borrowers may not charge tenants late fees, penalties or other charges related to nonpayment.

The program, which was announced just before the $2 trillion federal stimulus was passed, allows multifamily landlords whose properties are financed with a Freddie Mac loan to defer loan payments for three months. The program could potentially apply to as many as 27,000 properties that currently have performing Freddie Mac loans, where approximately 4.2 million renters reside, according to the agency. The latest census data shows that there are more than 40 million renters in the US.

Since 2008, Freddie Mac has become more active in multifamily lending, especially in New York City. Its small-balance loan program generated some controversy, when it was used by borrowers whose business model depended on deregulating rent-stabilized apartments. Freddie Mac multifamily loans made up more than 20% of total multifamily debt originations in 2019, according to the agency.


Related Articles

arrow_forward_ios
CIM Group’s Shaul Kuba, Knotel's Amol Sarva, Related Group’s Jorge Pérez and The Agency’s Mauricio Umansky (Getty, Sarva by Sasha Maslov, iStock)

These real estate companies got fat PPP loans

These real estate companies got fat PPP loans
Photo illustration of Mayor Carlos Gimenez (Getty, iStock)

Restaurants, gyms to close again in Miami-Dade

Restaurants, gyms to close again in Miami-Dade
270 Park Avenue (Google Maps; iStock)

City planning through a pandemic

City planning through a pandemic
(iStock)

UK home prices hit a low not seen since 2012

UK home prices hit a low not seen since 2012
San Francisco Supervisor Dean Preston and San Francisco Apartment Association Executive Director Janan New

Real estate groups challenge San Fran’s permanent ban on coronavirus-related evictions

Real estate groups challenge San Fran’s permanent ban on coronavirus-related evictions
Malls are hemorrhaging retailers left and right. What will happen with all that space? Some could be converted into apartments and condominiums. (iStock)

Retail-to-residential conversions are in cards at America’s doomed malls

Retail-to-residential conversions are in cards at America’s doomed malls
Photo illustration of Gov. Andrew Cuomo, Judge C. Stephen Hackeling and Chief Justice Lawerence Marks (Getty, iStock)

Judge rules evictions guidance unconstitutional, moratorium invalid

Judge rules evictions guidance unconstitutional, moratorium invalid
Related chairman Stephen Ross and Related Companies Portfolio CEO Richard O’Toole withBronx Terminal Market and Time Warner Center (Getty, Google Maps, Wikipedia)

Related lays out $200M debt settlement plan for Tel Aviv bondholders

Related lays out $200M debt settlement plan for Tel Aviv bondholders
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...