The level of outstanding commercial and multifamily mortgage debt in the U.S. climbed to nearly $5 trillion at the end of 2025, driven largely by sustained multifamily lending and robust activity from government-sponsored enterprises (GSEs) Fannie Mae and Freddie Mac.
Total outstanding mortgage debt rose by 1.5%, or $75.2 billion, in the fourth quarter to reach $4.99 trillion, according to a quarterly report published Thursday by the Mortgage Bankers Association (MBA).
On a year-over-year basis, total commercial and multifamily debt increased 4.5%, representing a $214 billion jump from the end of 2024. The specific multifamily category surged 6.6% over the course of the year to hit $2.29 trillion.
The report highlighted a real estate finance market that continues to expand despite macroeconomic headwinds.
“Growth was driven largely by multifamily lending and sustained activity from agency and GSE portfolios, which led to both quarterly and annual gains,” said Reggie Booker, MBA’s associate vice president of commercial research, in commentary accompanying the report.
He added that although banks are the largest overall holders of commercial and multifamily mortgage debt, “the steady pace of growth across investor groups reflects a market that is still active, but increasingly selective as lenders navigate a higher rate environment and evolving property fundamentals.”
While origination volumes and overall debt levels hit new highs, the underlying health of those loans presents a more complex picture. According to a concurrent MBA report on commercial delinquencies, mortgage performance remained “mixed” across major investor groups in the fourth quarter, with some portfolios such as Fannie Mae’s experiencing rising delinquencies, while others, including life insurance companies, recorded decreases.
Booker noted that while “overall loan performance remains resilient,” specific capital sources are grappling with persistent challenges. This juxtaposition of record debt volume against rising delinquencies in certain sectors provides concrete context for why lenders are exercising that increased selectivity.
Looking at major investor groups, commercial banks and thrifts continue to maintain the lion’s share of the market, according to MBA data, holding 37% of commercial and multifamily mortgages, totaling $1.9 trillion. Agency and GSE portfolios and mortgage-backed securities (MBS) hold the second-largest portion at $1.1 trillion, accounting for roughly 23% of the total.
Life insurance companies followed with $774 billion (16%), while commercial mortgage-backed securities (CMBS), collateralized debt obligations (CDO) and other asset-backed security (ABS) issues held $647 billion (13%).
Commercial banks boosted their holdings by $24.8 billion (1.3%) during the fourth quarter. Life insurance companies saw an increase of $11.5 billion (1.5%), while CMBS, CDO and other ABS issues grew by $3.6 billion (0.6%).
