WASHINGTON, DC–Freddie Mac's Small Balance Multifamily Loan program is one of the fastest growing at the GSE, ringing up $1.26 billion in the first quarter of 2017 alone.
When the numbers for Q2 are tallied and charted it will be clear the program hit a particularly strong growth spurt between 1:00 – 4:00 CT pm. on Tuesday, June 27 and 9:00 am – 4:00 pm CT. on Wednesday, June 28. Over those 12 working hours, it committed 61 loans for $163 million. Of the 2,581 apartment units that were financed during that period, 86% were supporting workforce housing.
Normally it would take between two to three weeks to close those transactions, Catherine Evans, senior director of Small Balance Lending, Multifamily Credit & Underwriting, tells GlobeSt.com.
Freddie Mac pushed the loans over the finish line — fully vetted and conscientiously underwritten — in such short order during a pop up event timed to coincide with the Mortgage Bankers Association's Small Balance Lending Summit held in Dallas during those days. The loan lab was right outside the conference at the Grand Hyatt DFW.
A Lively Event
The event was very lively with bells ringing — 61 times to be precise — whenever a deal was closed. On one side of the tables were Freddie Mac's staff of underwriters and loan approvers; on the other were the sellers of the loans. The tables themselves were weighed down with screens and laptops and paper coffee cups; the chairs got less use as people kept jumping up to point out something on a screen to their table mate.
“We were engaging with our customers throughout the day. At any moment a lender or banker could be walking by …it is hard to imagine the energy in that room unless you were there,” Stephen Johnson, VP of the Small Balance Loan Business, tells GlobeSt.com.
To be clear, Freddie Mac wasn't starting on the loans cold at the event. It had received the borrowers' packages throughout the preceding week, Evans says.
“That gave the underwriters the chance to figure out what the top issues or concerns were with the loan and be able to get those resolved and the loan signed off on during the course of the event,” she says. Once the underwriter was through, the paperwork has handed to the loan approver sitting in the next chair.
A Regular Offering?
Freddie Mac held a similar event last year at the MBA conference. This second loan lab — as the event was called — showed the GSE that it could, if it had to, approve a large volume of loans in a short period of time. “We are contemplating on how we could apply this concept on a regional basis,” Evans says. That vision, as it stands right now at least: Freddie Mac would hold a mini loan lab in a regional office for one day to push through a large amount of volume.
WASHINGTON, DC–Freddie Mac's Small Balance Multifamily Loan program is one of the fastest growing at the GSE, ringing up $1.26 billion in the first quarter of 2017 alone.
When the numbers for Q2 are tallied and charted it will be clear the program hit a particularly strong growth spurt between 1:00 – 4:00 CT pm. on Tuesday, June 27 and 9:00 am – 4:00 pm CT. on Wednesday, June 28. Over those 12 working hours, it committed 61 loans for $163 million. Of the 2,581 apartment units that were financed during that period, 86% were supporting workforce housing.
Normally it would take between two to three weeks to close those transactions, Catherine Evans, senior director of Small Balance Lending, Multifamily Credit & Underwriting, tells GlobeSt.com.
A Lively Event
The event was very lively with bells ringing — 61 times to be precise — whenever a deal was closed. On one side of the tables were
“We were engaging with our customers throughout the day. At any moment a lender or banker could be walking by …it is hard to imagine the energy in that room unless you were there,” Stephen Johnson, VP of the Small Balance Loan Business, tells GlobeSt.com.
To be clear,
“That gave the underwriters the chance to figure out what the top issues or concerns were with the loan and be able to get those resolved and the loan signed off on during the course of the event,” she says. Once the underwriter was through, the paperwork has handed to the loan approver sitting in the next chair.
A Regular Offering?
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Erika Morphy
Erika Morphy has been writing about commercial real estate at GlobeSt.com for more than ten years, covering the capital markets, the Mid-Atlantic region and national topics. She's a nerd so favorite examples of the former include accounting standards, Basel III and what Congress is brewing.
