Fannie Mae Discount Mortgage Backed Security (DMBS)
For most multifamily property types
The DMBS (Discount Mortgage Backed
Security) provides exceptionally low rates for borrowers seeking either a single
loan of at least $25 million or a pool* of loans totaling $25 million aggregated
over 12 months.
The DMBS is a variable rate financing
alternative for borrowers seeking the lowest pay rate. The DMBS is sold at a
discount and repaid at par every 3 months in lieu of a stated interest rate. The
DMBS variable rate mimics 90 day LIBOR at a cost significantly below available
conventional variable rate financing. With the lowest variable rates available,
the DMBS can result in substantial cash flows and savings over the life of the
loan. The DMBS may also convert to a fixed rate loan under certain
circumstances.
PNC ARCS is one of America’s leading
commercial lenders with an acknowledged expertise in multifamily finance and one
of America’s leading Fannie Mae DU S™ lenders for more than a decade.
As a PNC Real Estate Finance Company,
PNC ARCS is part of PNC Financial Services, one of the largest diversified
financial services companies in America. Now PNC ARCS can provide access to debt
and equity financing, construction loans, permanent financing, forward
commitments, tax credits, direct bond purchase programs, mezz, bridge, Fannie
Mae, Freddie Mac, FHA and Capital Markets. One single source to meet our
borrowers’ needs.
The company is now the single source
for all real estate financing across the full range of commercial property
types.
Beyond the benefits of any specific
lending product, PNC ARCS’ experience, expertise and unwavering commitment to
extraordinary customer service are what set us apart from the rest. No one
delivers more.
*DMBS pools must have common control,
not ownership, and there is no requirement for cross collateralization or
geographic diversity.
*DMBS pools must have common control, not ownership, and there is no
requirement for cross collateralization or geographical diversity.
Product Overview
Eligibility Most multifamily property types
Loan Amounts Single asset loans of at least $25 million or multiple asset transactions of at least $25 million
delivered within a 12 month period.
Term/Amortization 5, 7, and 10 year terms Up to 30 year amortization
Interest Only available but subject to restrictions
Interest Rates Variable rate mimics 90 day LIBOR at a much lower cost than the conventional Fannie Mae ARM.
Interest Rate Cap Interest rate cap must be purchased separately prior to rate lock and closing.
Debt Service Coverage Ratio 1.00x minimum at the underwriting ceiling
Loan to Value 75%
maximum
Conversion May convert to 7 or 10 year fixed rate at any DMBS rollover date with a nominal
fee
Personal Recourse Non-recourse with standard “Carve-Outs” and Key Principal obligations
Prepayment Fee maintenance, 1% prepayment premium after 1 year
lock-out (on certain pricing categories)
Origination Fee 1% or less when applicable
Third Party Fees Includes legal, appraisal, engineering, and environmental reports. Seismic reports and survey may also be required.
Replacement Reserve Impounds Required - not less than $150/unit
(waiver considered for special circumstances)
Taxes and Insurance Impounds Required. Waiver considered for low leverage transactions.
Assumability Assumable with lender approval and a 1% fee