Fannie Mae recently released additional information regarding new protections for tenants in multifamily properties with mortgages backed by Fannie Mae and Freddie Mac, according to a release.

The protections are included in the Enterprise Multifamily Lease Standards Policy for multifamily housing providers (borrowers), announced by the Federal Housing Finance Agency (FHFA).

Under the policy, which is effective Feb.28, 2025, all new GSE-backed loans will require multifamily borrowers to include the following three minimum standards within tenant leases:

• A 30-day notice of rent increases: Renters will receive written notice of a rent increase at least 30 calendar days prior to said increase.
• A 30-day notice of lease expiration: Renters will receive written notice of the scheduled expiration of the residential lease at least 30 calendar days prior to said expiration.
• A five-day grace period for late rent payments: Renters will receive a minimum five calendar day period from the rent due date before late fees or other penalties can be charged.

To provide additional transparency to tenants and to help lenders and borrowers implement the new requirements, Fannie Mae and Freddie Mac recently published FAQs related to the standards and an initial policy grid that outlines the policy, applicability, updates to loan documents, implementation requirements for borrowers, and monitoring and enforcement details.

The release also said Fannie Mae will provide additional details to lenders and borrowers prior to the February 2025 effective date and will publish on its website information to help tenants understand their rights and responsibilities.

“Fannie Mae is committed to implementing protections that support housing stability for the individuals and families who live in the multifamily rental properties we back. The new Enterprise Multifamily Lease Standards align with our mission to expand access to housing that is both affordable and sustainable,” Michele Evans, executive vice president and head of multifamily at Fannie Mae, said in the release. “They reflect our comprehensive renter needs research and methodical approach to analyzing renter obstacles and outcomes and will provide the industry with consistent expectations regarding tenant notification and grace period practices.

“We look forward to continuing to work closely with FHFA, Freddie Mac, our lenders and borrowers, and other multifamily housing stakeholders on these and other important solutions to address the challenges faced by renter households across the country,” Evans added.