Senior debt is the top-priority mortgage loan on a property — typically first lien, paid first in liquidation, lowest-cost financing in the capital stack. Most LA multifamily uses senior debt plus equity, with or without mezzanine.
Senior debt for LA multifamily typically comes from agency lenders (Fannie Mae, Freddie Mac), banks, insurance companies, or CMBS. Because senior debt is first in line on default, rates are lower than other capital stack layers. LTV limits apply.
LA multifamily senior debt rates in 2026: agency 6.5–7.5%, CMBS 6.75–7.75%, bank 6.5–8%, insurance company 6.5–7.25% depending on terms. LTV typically capped at 65–75% on stabilized inventory.
From the Sterman LA Multifamily Glossary — defined the way a broker with $1.41 billion across 254 closed transactions actually uses these terms.
Michael Sterman, Senior Managing Director Investments, Marcus & Millichap.
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