Limited Experience Owner

Requirements

You must determine if any SponsorSponsorPrincipal equity owner and/or primary decision maker of the Borrower (often the Key Principal or the Person Controlling the Key Principal). , Key PrincipalKey PrincipalPerson who controls and/or manages the Borrower or the Property, is critical to the successful operation and management of the Borrower and the Property, and/or may be required to provide a Guaranty. , or GuarantorGuarantorKey Principal or other Person executing a Payment Guaranty, Non-Recourse Guaranty, or any other Mortgage Loan guaranty. is a Limited Experienced OwnerLimited Experienced OwnerAny Sponsor, Key Principal, or Guarantor who has either: never obtained a prior Fannie Mae multifamily Mortgage Loan; or during the last 10 years, not owned a Controlling Interest in one or more multifamily properties for at least: 5 consecutive years; or 2 consecutive years if the….

To determine if a Co-Tenant BorrowerCo-Tenant BorrowerBorrower consisting of tenants-in-common that own the Property in equal or unequal shares. is a Limited Experienced OwnerLimited Experienced OwnerAny Sponsor, Key Principal, or Guarantor who has either: never obtained a prior Fannie Mae multifamily Mortgage Loan; or during the last 10 years, not owned a Controlling Interest in one or more multifamily properties for at least: 5 consecutive years; or 2 consecutive years if the…, you:

• must analyze the PersonPersonLegal person, including an individual, estate, trust, corporation, partnership, limited liability company, financial institution, joint venture, association, or other organization or entity (whether governmental or private). named as the co-tenant representative per Part I, Chapter 3: Borrower, Guarantor, Key Principals, and Principals, Section 302.02: Co-Tenant Borrowers; and
• may exclude from the analysis any:
  • passive Tenant in Common Member, who is solely named a Key PrincipalKey PrincipalPerson who controls and/or manages the Borrower or the Property, is critical to the successful operation and management of the Borrower and the Property, and/or may be required to provide a Guaranty. to comply with Part I, Chapter 3: Borrower, Guarantor, Key Principals, and Principals, Section 302.02: Co-Tenant Borrowers; or
  • BorrowerBorrowerPerson who is the obligor per the Note. whose Controlling InterestControlling InterestFor any entity, ownership or control of 50% or more of the ownership interests in the entity or the power or right to control or modify, directly or indirectly, the management and operations of the entity. is owned by a Key PrincipalKey PrincipalPerson who controls and/or manages the Borrower or the Property, is critical to the successful operation and management of the Borrower and the Property, and/or may be required to provide a Guaranty. or GuarantorGuarantorKey Principal or other Person executing a Payment Guaranty, Non-Recourse Guaranty, or any other Mortgage Loan guaranty. that does not meet the definition of a Limited Experienced OwnerLimited Experienced OwnerAny Sponsor, Key Principal, or Guarantor who has either: never obtained a prior Fannie Mae multifamily Mortgage Loan; or during the last 10 years, not owned a Controlling Interest in one or more multifamily properties for at least: 5 consecutive years; or 2 consecutive years if the….

For each Limited Experienced OwnerLimited Experienced OwnerAny Sponsor, Key Principal, or Guarantor who has either: never obtained a prior Fannie Mae multifamily Mortgage Loan; or during the last 10 years, not owned a Controlling Interest in one or more multifamily properties for at least: 5 consecutive years; or 2 consecutive years if the…:

• verify the identity of the SponsorSponsorPrincipal equity owner and/or primary decision maker of the Borrower (often the Key Principal or the Person Controlling the Key Principal). and each Key PrincipalKey PrincipalPerson who controls and/or manages the Borrower or the Property, is critical to the successful operation and management of the Borrower and the Property, and/or may be required to provide a Guaranty. or GuarantorGuarantorKey Principal or other Person executing a Payment Guaranty, Non-Recourse Guaranty, or any other Mortgage Loan guaranty. , or any PersonPersonLegal person, including an individual, estate, trust, corporation, partnership, limited liability company, financial institution, joint venture, association, or other organization or entity (whether governmental or private). who owns a Controlling InterestControlling InterestFor any entity, ownership or control of 50% or more of the ownership interests in the entity or the power or right to control or modify, directly or indirectly, the management and operations of the entity. in the BorrowerBorrowerPerson who is the obligor per the Note. , using a current
  • driver’s license or passport,
  • personal residence, and
  • business address (not a P.O. Box); 
• ensure your Credit Underwriting or Screening team meets, in person or virtually, each individual:
  • identified as, or on behalf of, the Key PrincipalKey PrincipalPerson who controls and/or manages the Borrower or the Property, is critical to the successful operation and management of the Borrower and the Property, and/or may be required to provide a Guaranty. or GuarantorGuarantorKey Principal or other Person executing a Payment Guaranty, Non-Recourse Guaranty, or any other Mortgage Loan guaranty. ; or
  • who owns, directly or indirectly, a Controlling InterestControlling InterestFor any entity, ownership or control of 50% or more of the ownership interests in the entity or the power or right to control or modify, directly or indirectly, the management and operations of the entity. in
    • the BorrowerBorrowerPerson who is the obligor per the Note. ,
    • any Key PrincipalKey PrincipalPerson who controls and/or manages the Borrower or the Property, is critical to the successful operation and management of the Borrower and the Property, and/or may be required to provide a Guaranty. , or
    • any GuarantorGuarantorKey Principal or other Person executing a Payment Guaranty, Non-Recourse Guaranty, or any other Mortgage Loan guaranty. ;
• for any individual identified as a Key PrincipalKey PrincipalPerson who controls and/or manages the Borrower or the Property, is critical to the successful operation and management of the Borrower and the Property, and/or may be required to provide a Guaranty. or GuarantorGuarantorKey Principal or other Person executing a Payment Guaranty, Non-Recourse Guaranty, or any other Mortgage Loan guaranty. , or who owns a Controlling InterestControlling InterestFor any entity, ownership or control of 50% or more of the ownership interests in the entity or the power or right to control or modify, directly or indirectly, the management and operations of the entity. in the BorrowerBorrowerPerson who is the obligor per the Note. , Key PrincipalKey PrincipalPerson who controls and/or manages the Borrower or the Property, is critical to the successful operation and management of the Borrower and the Property, and/or may be required to provide a Guaranty. , or GuarantorGuarantorKey Principal or other Person executing a Payment Guaranty, Non-Recourse Guaranty, or any other Mortgage Loan guaranty. :
  • obtain a resume; and
  • verify employment history using
    • a Lexis-Nexis report, or
    • other industry standard background reporting tool;
• review, for each Key PrincipalKey PrincipalPerson who controls and/or manages the Borrower or the Property, is critical to the successful operation and management of the Borrower and the Property, and/or may be required to provide a Guaranty. or GuarantorGuarantorKey Principal or other Person executing a Payment Guaranty, Non-Recourse Guaranty, or any other Mortgage Loan guaranty. , or PersonPersonLegal person, including an individual, estate, trust, corporation, partnership, limited liability company, financial institution, joint venture, association, or other organization or entity (whether governmental or private). who owns a Controlling InterestControlling InterestFor any entity, ownership or control of 50% or more of the ownership interests in the entity or the power or right to control or modify, directly or indirectly, the management and operations of the entity. in the BorrowerBorrowerPerson who is the obligor per the Note. , their:
  • investment profile;
  • business goals; and
  • primary sources of income, which must be consistent with business activities;
• obtain evidence of the origin of transaction funds for
  • an AcquisitionAcquisitionAny Purchase of either the: Property’s fee simple or leasehold interest via a deed transfer; or Controlling Interest in the Borrower. , or
  • cash-in refinances requiring the BorrowerBorrowerPerson who is the obligor per the Note. to deposit additional funds at closing; and
• determine any appropriate adjustments to the reported liquidity and net worth of the SponsorSponsorPrincipal equity owner and/or primary decision maker of the Borrower (often the Key Principal or the Person Controlling the Key Principal). and each Key PrincipalKey PrincipalPerson who controls and/or manages the Borrower or the Property, is critical to the successful operation and management of the Borrower and the Property, and/or may be required to provide a Guaranty. or GuarantorGuarantorKey Principal or other Person executing a Payment Guaranty, Non-Recourse Guaranty, or any other Mortgage Loan guaranty. , including:
  • verifying liquidity based on 3 consecutive months of bank or brokerage statements for accounts (a bank or brokerage letter alone is insufficient to verify liquidity); and
  • using best efforts to verify the value (including ownership interest and debt outstanding) of all real estate owned, directly or indirectly, using
    • K-1 statements,
    • CoStar or similar service, or
    • mortgage loan verification from other creditors.