Small Loans

Small Loans for your Big Picture

Berkadia Small Loans offers Fannie Mae Small Loans and Freddie Mac Optigo® Small Balance Loans for multifamily loans up to $9 million. Comprised of dedicated management and mortgage banking professionals, the team’s intimate knowledge of Fannie Mae and Freddie Mac loan programs provides a seamless process and customized solutions. Backed by the power of Berkadia’s market data, we empower our clients with access to the best rates, terms, and leverage for their investments, alongside the knowledge to make investment decisions confidently.

Get a Quote: Multifamily Small Loans


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Recent Transactions

The Leaf in Beaverton

Beaverton, OR

Freddie Mac SBL

Multifamily Refinance

The Bungalows

Rancho Cordova, CA

Freddie Mac SBL

Multifamily Acquisition

1627 High Street

Oakland, CA

Freddie Mac SBL

Multifamily Acquisition


Shoreline, WA

Fannie Mae Small Loan

Multifamily Refinance

Warren Park

Denver, CO

Freddie Mac SBL

Multifamily Acquisition

Waverly Arms Apartments

Portland, OR

Freddie Mac SBL

Multifamily Refinance

Success is not Purely Measured by Numbers

But they help tell our story:
transactions closed with Freddie Mac and Fannie Mae’s small loan programs in 2022 and 2023.
financed in 2022 and 2023.
Freddie Mac’s #1 Optigo® Lender in 2022 and 2023.
in combined agency lending production in 2022 and 2023.

Client Stories


Berkadia is dedicated to leading the digital transformation of commercial real estate with investments in technology like Esusu, a rent-reporting platform created to build tenants’ credit. Multifamily property owners who implement Esusu can decrease evictions and vacancies and maximize NOI. As partners, Berkadia borrowers may receive closing cost credits and discounted rates.


As Freddie Mac’s #1 Optigo® Lender and Fannie Mae’s #2 DUS Producer, Berkadia Small Loans is skilled in navigating GSE programs to find the best loan executions for our clients. Though the lending landscape continues to evolve, agency small loan executions remain one of the best options for investors who recognize the value of optionality and take advantage of rate locking.

Berkadia is a top multifamily lender because we’re experts in our domain. Whether it’s small loan agency lending, FHA/HUD financing or affordable housing, no one has more knowledge, experience, or ability to execute than we do. It enables us to provide best-in-class financing for clients no matter what they are doing in the multifamily space.”
Robert Doxsee
Managing Director
Learn More, Download our Brochure

frequently Asked Questions

What property types are eligible for a small balance loan?

The Fannie Mae Small Loans and Freddie Mac Optigo® Small Balance Loans (SBL) programs offered by Berkadia a commercial mortgage broker provide financing for multifamily properties with 5 or more apartment units including properties with the following characteristics:

  • Properties with certain tax abatements
  • Properties with short-term rentals, subject to a percentage of the total unit count
  • Properties with micro-units equal to or less than 350 SF, subject to a percentage of the total unit count
  • Seniors housing with no resident services
  • Properties with commercial (non-residential) space or commercial income, subject to a percentage of the total space and income
  • Properties with no more than 50% student, military, or single employer concentration
  • Properties with tenant-based rental assistance
  • Properties with no more than 20% of the units encumbered by a HAP contract
  • Properties subject to affordability restrictions and/or tax credits lasting no more than two years
  • Properties with a Master Lease concentration comprising no more than 25% of the total gross potential rent (GPR)
  • Non-contiguous parcels so long as each parcel has buildings with 5 or more units that meet occupancy requirements and are located within the same MSA
  • Properties with buildings that have less than 5 units as long as they are located on the same or contiguous parcels
  • Properties with private wells and/or septic tanks if common in the market
  • Fractured condominiums (subject to controlling a minimum percentage of the condominium association)
  • Manufactured Housing Communities (MHCs)
  • Properties with scenario expected loss (SEL) of less than or equal to 40%
What is a property’s “affordability” and how is it factored into my loan terms?

A property’s affordability is based on the percentage of units that meet the “mission-driven” definitions set by the Federal Housing Finance Agency (FHFA) which are generally based on a ratio of rent to area median income (AMI). Fannie Mae and Freddie Mac typically offer better rates for properties with greater affordability to align their business with their congressional mandate – to provide liquidity, stability and affordability to the mortgage market.

What is an “agency” lender or “GSE”?

The Federal National Mortgage Association (FNMA), and the Federal Home Loan Mortgage Corporation (FHLMC), also known as Fannie Mae and Freddie Mac, respectively, are commonly referred to as “agency” lenders. Both are government-sponsored enterprises (GSEs) created by Congress to provide liquidity, stability, and affordability to the single-family and multifamily mortgage market.

What are the advantages of getting a loan through the Fannie Mae Small Loans and Freddie Mac Optigo® Small Balance Loans (SBL) programs compared to my local bank?
  • More competitive terms that can include higher leverage, longer amortization periods, greater interest only periods, and lower rates
  • Comparable products (fixed-rate and hybrid ARM loans) with flexible prepayment structures (declining prepayment and shortened yield maintenance periods available)
  • Non-recourse (with standard carve outs). Most local banks are full recourse.
  • Longer loan terms available (up to 30 years). Local banks generally prefer not to exceed 5 years
  • Consistent loan programs and terms available nationwide. Local banks are typically limited geographically and offer unique lending programs with varying terms.
  • No obligation to open a bank account requiring you to maintain a minimum balance, tying up capital that could be used for other purposes
What are the unique competitive advantages of the Fannie Mae Small Loans and Freddie Mac Optigo® Small Balance Loans (SBL) programs?

Advantages of Fannie Mae Small Loans vs. Freddie Mac SBL:

  • Offers up to 30-yr fixed rate options (10-yr fixed rate is maximum fixed-rate loan term for Freddie Mac SBL)
  • Supplemental financing available (not available for Freddie Mac SBL)
  • Manufactured Housing Community (MHC) is an eligible property type (ineligible for Freddie Mac SBL)
  • Greater control/flexibility with underwriting and closing timeframe
  • Greater interest only may be available on longer-term loans than Freddie Mac SBL, as well as higher LTVs with lower minimum DSCRs in secondary and tertiary markets
  • Hybrid ARM: 30-yr maximum terms and no prepayment penalties during adjustable-rate period (20-yr max term and 1% prepayment penalty during adjustable-rate period for Freddie Mac SBL hybrid ARMs, although 1% penalty is waived if loan is refinanced with Freddie Mac SBL)
  • Allows a higher concentration of student or military tenants than Freddie Mac SBL
  • Allows certain fractured condominium properties and properties with private wells or septic (ineligible for Freddie Mac SBL)
  • Higher maximum loan amount ($9MM vs. $7.5MM) for Freddic Mac SBL” 

Advantages of Freddie Mac SBL vs. Fannie Mae Small Loans:

  • Rate held at application (typically rate is not locked until 30-60 days after executing a loan application for Fannie Mae Small Loan loans)
  • 1.20x min DSCR in Top Markets (vs. 1.25x for Fannie Mae Small Loans unless loan meets certain criteria)
  • Typically more interest only available than Fannie Mae Small Loans on shorter-term loans
  • Competitive 5-yr hybrid ARM product (not offered by Fannie Mae Small Loans)
  • Hybrid ARM rates generally better than Fannie Mae Small Loans hybrid ARM rates
  • No 0.10% Application fee in Top Markets (Fannie Mae Small Loans 0.10% delivery fee in all markets)
  • Declining prepayment options typically cheaper (less of an impact to the rate) than Fannie Mae Small Loans
What is the origination process?

At a high level, the origination process for a Fannie Mae Small Loans and Freddie Mac Optigo® Small Balance Loans (SBL) programs available through Berkadia is as follows:

  • Obtain indicative loan terms by providing basic property information and discussing your unique situation and goals with an expert Berkadia partner
  • Get quotes by providing additional information and property documents (see here)
  • Select a quote and execute a loan application summarizing the agreed upon loan terms
  • Provide necessary due diligence for your loan to be underwritten and approved by the lender as well as Freddie Mac or Fannie Mae (if necessary)
  • Execute a loan commitment confirming your final loan terms
  • Lock your rate and close your loan
How long does it take to close a loan?

The average application to closing timeline is typically 60-70 days. However, if third-party reports are expedited and all due diligence is provided in a timely manner, it may be possible to close within as few as 45-55 days.

When can I lock my rate?

With Fannie Mae’s Small Loan program, a portion of the rate is not locked until the due diligence period is completed, approximately 30-60 days from the receipt of an executed loan application.

Freddie Mac Optigo® Small Balance Loans (SBL) rates are held as of the date of an executed loan application provided that a full due diligence package is delivered to Freddie Mac within 35 business days.

What documents are required to obtain a loan application (aka term sheet)?

At a minimum, you will be required to submit the following documents:

  • Current rent roll
  • Trailing 12-month operating statement
  • Property operating budget

Additionally, having the following information and documents available can help expedite the process and address potential issues before they arise:

  • Borrower related:
    • Ownership structure and percentages
    • Borrower(s) bio/resume
    • Estimated net worth, liquidity, and FICO scores of borrower(s)
    • Borrower(s) schedule of real estate owned (SREO)
    • Third-party property manager information (if applicable)
  • Property related:
    • Commercial (i.e., retail or office) rent roll (if applicable)
    • Physical occupancy (trailing 12 months)
    • Cost basis, existing loan amount, and anticipated closing costs such as prepayment penalties (if refinance)
    • Details on recent or planned capital improvements (if available)
    • Interior/exterior property photos
    • Offering memorandum (if available)
    • Student, military, or other tenancy concentrations (if applicable)
    • Property-based rent and/or affordability restrictions
    • Other unique property characteristics such as tax abatements, short-term rentals, micro-units, or residential services such as those provided for certain types of seniors housing.
What ownership structures are eligible?

The following ownership structures are permitted by the Fannie Mae Small Loans and Freddie Mac Optigo® Small Balance Loans (SBL) programs:

  • Individual
  • Single asset entity (typically in the form of an LLC)
  • Multiple asset entity (with conditions; typically in the form of an LLC)
  • Revocable and irrevocable trusts (with conditions)
  • General partnership
  • Corporation
  • Real estate investment trust (REIT)
  • Tenancy-in-Common (TIC) with five or fewer members
  • Not-for profit corporations (with conditions)
  • Funds

Ineligible ownership structures include:

  • Series LLCs
  • Transactions with in-place Hard Preferred Equity or Subordinate Debt
  • Land Trusts/Delaware Statutory Trusts
  • Pension or Retirement Accounts
What is the minimum required net worth and liquid assets?

To qualify for Fannie Mae Small Loans and Freddie Mac Optigo® Small Balance Loans (SBL) programs, individual borrowers or key principals must have combined net worth that equals or exceeds 1x the desired loan amount and liquidity equal to at least 9 monthly payments of principal and interest, or generally ~5-10% of the desired loan amount.

What is the minimum required FICO score?

If the borrower is an individual, a FICO score of 680 or better is typically required. Some flexibility may be available if there are multiple key principals.


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Josh Bodin

Senior Vice President

Mortgage Banking

Robert Doxsee

Managing Director

Matthew Nelson

Managing Director

Jack Alvarez