Are you looking to get a multifamily loan for an investment property and wondering what you would need? This video explains what multifamily loans are and how do you go about getting one with FHA.
Financing a multifamily home or property is an innovative opportunity to generate income from one side of your investment from a unit you’re renting out. Multifamily loans are used by investors to finance multifamily properties.
These properties can include condos, townhomes, duplexes, and apartment buildings. The properties are typically between two to four units or commercial-residential properties of five units and up. Generally, properties with more than five units are considered multi-family commercial real estate (MFCR), while anything with less than five is classified as residential. Adhering to maximum loan limits is one of the mortgage underwriting criteria for conventional multifamily financing. 20% of the purchase price is a typical down payment with a conventional multifamily loan. Multifamily loan borrowers will need to have good credit, cash reserves, rent rolls for the property, and two years of tax returns. When it comes to your property, you must have 90% occupancy within ninety days.