The news comes just days after both government sponsored enterprises (GSEs) made formal announcements that they will allow mezzanine debt on qualifying senior multifamily mortgages (first mortgages) they purchase.

The RealShare Student Housing Conference is produced by ALM's Real Estate Media Group. Nearly 400 people attended the event at the Four Seasons Resort and Club in suburban Dallas to hear industry experts discuss student housing trends.

"We have to run the program by FHA, and they reviewed it once, and we announced it, and then they decided that they wanted to look at it again," says Richard Martinez, managing regional director of Freddie Mac.

Martinez, along with Frank Lutz, vice president of Fannie Mae, participated in a lunch panel called "Lunch with the Lenders," which was moderated by John Salustri, editorial director of ALM's Real Estate Media Group.

Martinez did not indicate when Freddie Mac's mezzanine program would be operational. This new roadblock for its mezzanine program will devastate many borrowers who are struggling to refinance multifamily or student housing properties that have declined in value. The program was billed as a solution to ease the painful process of deleveraging.

As GlobeSt. reported previously, student housing properties have suffered decreased valuations, similar to other commercial property sectors. However, the fundamentals of the student housing industry have held up, thanks to the sector's "recession resilient" qualities.

Lutz notes that performance of Fannie Mae's student housing portfolio has "been terrific." In fact, neither GSE has any student housing loans that are not in good standing – something that has been somewhat surprising to both organizations. Freddie Mac, for example, is performing an in-depth evaluation of its existing portfolio to understand exactly why it's performing so well.

Lutz attributes the "terrific" performance to Fannie Mae's underwriting criteria. Throughout the credit crunch, the GSE has not been compelled to tighten its underwriting criteria for student housing loans. Surprisingly, Freddie Mac has actually loosened its underwriting and will now provide loans up to 85 percent LTV, according to Martinez.

Martinez says Freddie Mac is doing so many student housing and multifamily loans that it is closing one securitization pool every five to six weeks. Likewise, Fannie Mae is securitizing "everything", Lutz says. Moreover, the GSE is holding a fair amount of the securitized loans on its books –by choice rather than necessity – because of the performance of its existing student housing loans.