• Skip to primary navigation
  • Skip to content

Freddie Mac Small Balance Loans

Non-Recourse, Fixed and Adjustable-Rate Apartment Financing

  • Home
  • Information
    • Loan Facts
    • Terms, Qualifications, and Guidelines
    • Term Sheet
    • Interest Rates
    • Portfolio Loans
  • Knowledge Base
    • Frequently Asked Questions
    • Glossary
  • Application
    • Application Process
    • Third Party Reports
    • Appraisal Process
    • Environmental Assessments
    • Property Condition Reports

Prepayment Penalties

June 6, 2019 By Janover Ventures

Prepayment Penalties in Relation to the Freddie Mac Optigo SBL Program

Prepayment penalties are designed to compensate a lender when a borrower decides to pay off their loan early, as the lender will be losing a significant amount of money in future interest payments. Prepayment penalties can be structured in a variety of different ways, but are usually larger at the beginning of the term of a loan, and grow smaller over time. All Freddie Mac Multifamily loans carry prepayment penalties, but each loan has slightly different parameters. In regards to the Freddie Mac Small Balance Loan program, borrowers can choose between yield maintenance or a step-down prepayment penalty. Yield maintenance reimburses a lender (or the investors, after a loan has been securitized) for the amount of interest that will not be paid by the borrower as a result of prepayment, while a step down prepayment penalty charges borrowers a percentage of the unpaid principal balance (UPB), which “steps down” by a certain amount each year.

Filed Under: Freddie Mac Multifamily Loans, Freddie Mac SBL, Glossary Tagged With: Freddie Mac Multifamily, Freddie Mac Optigo, Freddie Mac SBL, Freddie Mac Small Balance Loans, Multifamily Financing, Multifamily Loans, Multifamily Prepayment Penalties, Prepayment Penalties

Reader Interactions

 

Multifamily.Loans, Inc. is a Janover Ventures company. Please visit some of our family of sites at: Multifamily.loans, Commercial Real Estate Loans, CMBS.loans, SBA7a.loans, Home.loans, HUD.loans, HUD 232, HUD 223f, HUD 223a7, SBA Express Loans, SBA 504 Loans, and OpportunityZones.Help.

 

 

 


Janover Ventures, LLC.
7601 N Federal Hwy. Ste B140
Boca Raton Florida 33487

Call: (800) 567-9631
Email: hello@multifamily.loans

 

Information

Loan Facts

Terms, Qualifications, and Guidelines

Term Sheet

Interest Rates

Portfolio Loans

 

Knowledge Base

Frequently Asked Questions

Glossary

Application

Application Process

Third Party Reports

Appraisal Process

Environmental Assessments

Property Condition Reports