How Going Green Can Maximize Your Freddie Mac Loan Savings
There is more to Freddie Mac than government-backed loans that make financing multifamily more feasible.
As we’ve covered before, Freddie small balance programs provide up to $5M worth of competitive financing for investors looking to acquire or refinance multifamily properties.
But those looking to invest in environmentally friendly properties can be striking an even more favorable deal.
“Since Green Up loans are non-cap business, both agencies have a big appetite for these loans,” Hunt Mortgage Group director Joshi Yogesh tells Bisnow while discussing the program that unites clean real estate with Freddie Mac’s financing.
Green Up and Green Up Plus are programs that give property owners (or soon-to-be owners) the ability to apply for more funding if they meet certain requirements.
If properties are assessed to see what steps they can take to preserve an approved amount of water or energy, owners will be reimbursed up to $3,500. Should property owners agree to make suggested changes to the property, they could save on utility costs and get better loan terms.
“Not all clients know about this program,” Joshi tells us. "So it takes some effort on the loan officer's part to educate them on program terms and how it impacts the overall economics. Of course, once a client understands the economic advantage of going green, they're motivated to take part in the assessment."
Investors applying for financing on properties that already meet or exceed the green standards—if they also have affordable rental units—are also eligible for discounted loan pricing.
Properties that have received the Energy Star for Multifamily EPA designation and LEED certification from the US Building Council, among others, can apply.
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