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WASHINGTON, DC-Fannie Mae has priced its seventh Multifamily DUS REMIC this year for a total of $913.6 million. The deal is noteworthy as it is the GSE’s first to feature a 7/4 ARM — that is, a seven-year floating rate mortgage-backed security with a 4% interest rate cap. This is a product that is offered exclusively for affordable and workforce housing, according to Josh Seiff, Fannie Mae’s Vice President of Capital Markets and Trading. “That group was really the highlight of the deal, and it was oversubscribed immediately on being announced,” he said.

The 7/4 ARM program, which is for the refinancing or acquisition of stable, affordable housing projects,  is indeed a favorite of affordable housing owners. With the embedded interest rate cap, it is considered one of the easiest variable rate program as there are no external caps or swaps to be purchased. Loans under this program qualify

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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.

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