$3M Multifamily Refinance Denver | Commercial Lending Solutions 
Loan Size Example

$3 Million Multifamily Refinance in Denver

By Trevor Damyan, Commercial Mortgage Broker at Commercial Lending Solutions

A $3M multifamily refinance in Denver represents the sweet spot for small-balance execution, where borrowers are looking to lock in permanent financing on stabilized 5 to 40 unit properties across the metro area. In 2026, these deals typically see 5.75 to 6.25 percent rates depending on property condition and borrower profile, with leverage capping out around 75 percent LTV for agency products. The Denver multifamily market remains steady with moderate rent growth and low turnover, making refinances an attractive option for owners who acquired during the 2020 to 2022 period on adjustable debt. Freddie Mac Optigo SBL and Fannie Mae Small Balance DUS dominate this loan size, though regional bank balance sheet options remain viable for borrowers with established banking relationships.

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Capital Stack

What a $3M Multifamily Refinance Capital Stack Looks Like

At $3M, you are firmly in agency small-balance territory where Freddie Mac and Fannie Mae dictate terms and pricing. Regional banks and credit unions occasionally compete for owner-occupied or bridge-to-perm scenarios, but most Denver sponsors default to the efficiency and certainty of agency execution. Lender selection hinges on property age, unit count, occupancy, rent roll quality, and sponsor credit; borrowers with strong profiles and newer construction can drive tighter spreads and faster timelines.

Capital Source Rate / Cost Size / LTV Notes
Freddie Mac Optigo SBL 5.90 to 6.25 percent $3M / 70 to 75 percent LTV Fixed 25 to 30 year amortization, 1 percent origination, full recourse or limited recourse available, 10 year par loan, 45 to 60 day close timeline
Fannie Mae Small Balance DUS 5.85 to 6.20 percent $3M / 70 to 75 percent LTV Fixed 25 to 30 year amortization, 0.75 to 1 percent origination, limited recourse standard, 10 year fixed rate, 50 to 70 day close timeline
Regional bank balance sheet 5.95 to 6.40 percent $3M / 70 to 80 percent LTV Full recourse required, 5 to 7 year fixed options common, 30 to 40 day close, stronger margins for longer-term relationship borrowers
Credit union portfolio 6.00 to 6.50 percent $3M / 65 to 75 percent LTV Full recourse typical, 5 to 10 year fixed options, requires member status or sponsor equity, slower decisioning but flexible underwriting

Pricing reflects active CLS CRE quote pipeline as of April 2026. Specific deal pricing depends on sponsor, property, and structure.

Sponsor Profile

Who Closes a $3M Multifamily Refinance Deal

Typical sponsors range from experienced buy-and-hold operators with $50M to $250M in net worth to mid-market syndicators managing $200M to $500M AUM across 8 to 20 properties. Many are Denver-based or Rocky Mountain focused, with intimate knowledge of neighborhoods and submarket dynamics; they often accumulated these assets during the 2015 to 2019 acquisition window and are now refinancing out of construction debt or 5/1 ARM structures. Motivation is straightforward: lock in low rates, extend maturity dates, and free up capital for new acquisitions or value-add initiatives on existing portfolios.

From the CLS CRE Pipeline

A Real $3M Example

We closed a $2.85M refi on a 24-unit garden-style property in the northwest Denver submarket for an experienced local sponsor with a 15-year operating track record. The property was built in 2006, running 94 percent occupied with $1,625 average rent; the sponsor had owned for six years and wanted to extend the loan maturity and pull out $175K for capital reserves. We executed with a regional bank at 6.05 percent fixed for 7 years, 72 percent LTV, with 25-year amortization and full recourse from the sponsor. The deal closed in 33 days, and the sponsor immediately deployed freed-up cash into a value-add acquisition in the same submarket.

Anonymized. All deal references protect borrower and lender identity.

FAQ

$3M Multifamily Refinance Denver FAQ

Agency loans (Freddie Mac SBL and Fannie Mae Small) typically max out at 75 percent LTV, while regional bank balance sheet products may push to 80 percent depending on rent growth history and occupancy. For a $3M loan, expect 70 to 75 percent LTV as the industry standard, which translates to property values of $4M to $4.3M.
Freddie Mac Optigo SBL typically closes in 45 to 60 days from full application, while Fannie Mae Small Balance DUS runs 50 to 70 days due to tighter underwriting review and legal documentation. In Denver's competitive market, both are aggressive, so the margin is narrow; Freddie wins on speed and upfront certainty, Fannie on pricing flexibility and recourse options.
Denver multifamily execution is priced in line with Tier 2 metros (Austin, Nashville, Raleigh), running 10 to 15 basis points higher than top Tier 1 markets (New York, Los Angeles) but 5 to 10 basis points lower than smaller Tier 3 markets. The delta reflects Denver's strong rent growth, steady employment, and elevated property values relative to smaller metros.
Agency loans require minimum 1.20 to 1.25 percent DSCR, with 1.25 being the tighter standard for Freddie Mac Optigo SBL. Denver properties with stable rent rolls and long-term occupancy easily clear this threshold; sponsors with DSCR below 1.20 may face rate adjustments or require secondary financing.
Freddie Mac SBL and Fannie Mae Small both offer 0 to 3 year interest-only periods, though rates typically increase 15 to 25 basis points for IO provisions. Regional banks are more flexible and often extend IO to 5 years on balance sheet loans; most Denver sponsors skip IO for refinances where the goal is to stabilize amortization and reduce total cost of funds.


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