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Press Release

Fannie Mae Marks 25 Years of Multifamily Market Financing Through DUS Program

April 5, 2013

Unique Risk-Sharing Model Supports Workforce Rental Housing

Callie Wolk


WASHINGTON, DC – This month Fannie Mae (FNMA/OTC) marks the 25th anniversary of its Delegated Underwriting and Servicing (DUS®) program, a unique risk-sharing model that provides financing to the multifamily housing market. Fannie Mae relies primarily on the DUS network of 24 financial institutions and independent mortgage lenders to execute its multifamily business.  In 2012, 98 percent of the multifamily debt Fannie Mae acquired was delivered through the DUS platform.  Since the program was formally announced to participating lenders on April 4, 1988, Fannie Mae and its lender partners have provided more than $270 billion in liquidity to the mortgage market under the DUS program to finance more than 5.8 million units of multifamily housing.

“The strength of the DUS model is shared risk,” said Jeffery Hayward, Senior Vice President, Head of the Multifamily Mortgage Business, Fannie Mae.  “For 25 years, our flagship DUS platform has been successful because it relies on ‘skin in the game’ – lenders retain some of the underlying credit risk of the loans they sell to Fannie Mae, so both parties have a stake in each loan’s performance.”

DUS lenders must abide by rigorous credit and underwriting criteria and submit to Fannie Mae’s ongoing credit review and monitoring.  They can underwrite, close, and deliver loans on multifamily properties to Fannie Mae and typically retain one-third of the risk on every loan.

"It is impressive that the DUS program has been so active, so successful, and so beneficial to the multifamily housing industry for a quarter century," said Willy Walker, Chairman and Chief Executive Officer, Walker & Dunlop, LLC.  "The DUS program's delegated underwriting and risk-retention model, where the enterprise originating the mortgage retains risk for the life of the loan, has been exceptionally successful in aligning interests and allowing for hundreds of billions of dollars in credit to be efficiently and effectively lent across the United States.  Walker & Dunlop is honored to be one of the original, and now largest, partners to Fannie Mae in this very important and successful lending program."

Borrowers also value the liquidity and flexible loan structuring that is available through the DUS program and its lender network.

"Fannie Mae has been a consistent provider of liquidity to the multifamily housing market and has been providing financing to Equity Residential for the last 17 years,” said Mark Parrell, Executive Vice President and Chief Financial Officer, Equity Residential.  “The flexible financing options Fannie Mae offers through its DUS Flow and Credit Facility executions have allowed Equity Residential to effectively customize financing terms to our specific needs.  This gives Equity Residential the market power to quickly and efficiently acquire and sell properties as our needs arise. This anniversary is indeed a tremendous accomplishment for Fannie and its DUS originators and we congratulate you all.”

 “We are very proud of the strong partnerships we have formed with our DUS lenders over the past 25 years,” said Manuel Menendez, Jr., Senior Vice President, Head of Multifamily Customer Engagement, Fannie Mae.  “This milestone is a testament to our DUS partners.  Their invaluable role in creating and sustaining a strong multifamily market translates into more rental housing for working families.  We look forward to continuing our partnership in the years ahead.”

Fannie Mae’s DUS lenders include:
• Alliant Capital, LLC
• AmeriSphere Multifamily, LLC
• Arbor Commercial Funding, LLC
• Beech Street Capital, LLC
• Berkadia Commercial Mortgage, LLC
• Berkeley Point Capital LLC
• CBRE Multifamily Capital, Inc.
• Centerline Capital Group
• Citibank, N.A.
• Dougherty Mortgage LLC
• Grandbridge Real Estate Capital, LLC
• Greystone Servicing Corporation, Inc.
• HomeStreet Capital Corporation
• HSBC Bank USA, N.A.
• JPMorgan Chase & Co.
• KeyCorp Real Estate Capital Markets, Inc.
• M&T Realty Capital Corporation
• Oak Grove Capital
• Pillar Multifamily, LLC
• PNC Real Estate
• Prudential Mortgage Capital Company
• Red Mortgage Capital, LLC
• Walker & Dunlop, LLC
• Wells Fargo Multifamily Capital

As the largest source of financing in the multifamily sector, Fannie Mae remains a reliable partner across the spectrum of the nation’s rental housing needs and is committed to providing liquidity, stability, and affordability to the multifamily market.

Fannie Mae enables people to buy, refinance, or rent a home.

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