What We Do
We Provide Mortgage Funding
We fund apartment loans throughout the nation, purchasing loans from a network of lenders and then securitize these loans. Our funding spans the nation, including large metropolitan areas, mid-market cities and smaller communities. And the properties we finance house a wide array of renters, including students, single professionals, working families and senior citizens. Read about the differences between Freddie Mac’s Multifamily and Single Family businesses.
We Support Affordable Housing
Most of the loans we finance support affordable rental housing for low- and moderate-income households who earn no more than area median income. Because we tend to have lower borrowing costs than certain other funding sources, we help keep financing affordable for many properties that otherwise would have difficulty securing funding, including aging properties, those in need of capital improvements and apartments in smaller communities.
We Transfer Risk
Our strategy of transferring the vast majority of risk to private investors enables us to fulfill our mission while minimizing U.S. taxpayers’ exposure to potential losses. Our K-Deals® and SB-Deals®, as well as many of our other securities, include senior bonds, which we guarantee, and subordinate bonds, which we don’t guarantee, all backed by the same loans. Subordinate bonds are held by private investors and bear the risk of initial losses, creating a shock absorber for senior bonds. That’s a business model policymakers view as the future of housing finance. Read more about our impeccable credit quality.
The Bigger Picture
Freddie Mac Multifamily supports renting across the U.S., representing more than 43 million, or 35% of all households. We not only support the entire multifamily market, but we do so in all economic conditions. Part of our mission is to help keep the U.S. housing-mortgage markets stable and well financed, consistently promoting affordability. This includes facilitating purchases, refinancing, preservation and rehabilitation of existing multifamily apartment properties.
Many of the properties we finance might face challenges to secure funding from other sources. A large majority are more than 10 years old and many need structural or other significant improvements. We scale our presence to market need, even when other private funding sources pull back or even exit the market in times of economic stress.
As the number of renters continues to grow nationally, the inventory of affordable apartments remains low in most markets. In response to this challenge, we focus on financing workforce housing – properties that are affordable to renters in hourly wage jobs and/or with lower incomes. We also finance subsidized (or targeted affordable) housing that supports households earning very low incomes.
Whether it’s conventional or deeply affordable housing, seniors or student housing, in a city or suburb, Freddie Mac Multifamily plays a vital role in making sure that renters have access to adequate, affordable apartment homes.