Multifamily Property Loan

Financing Options for Investors

Mortgage for Multifamily Rental Property

  • Obtain funds for residential income property
  • Quick approvals for non-traditional loans
  • Very competitve rates & low fees
  • No Doc DSCR Loans
  • Second Mortgages
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5-plex multifamily

Multifamily Loan Overview

Investor eligibility

Loan amount & terms

Acceptable Properties

 

Example of a Multifamily Transaction


• Refinance a 3-unit property: $400,000
• Renovation costs: $75,000
• Current value: $675,000 (2 vacant units need repair)
• ARV (After Repair Value): $875,000

Step 1: Get Hard Money/Bridge Loan:
• $400,000 pays off 1st loan of $300K + repair funds
• $75,000 to renovate (100% of construction costs)
Total Loan Amount: $400,000

Step 2: DSCR 30 Year Fixed Loan:
• New Value (ARV): $875,000
• Cash out refinance (70% of value): $612,500

‐ You now have paid the hard money loan of your cash back and more
‐ You now have a property generating rent from all 3-units
‐ Your property value is projected to rise
fix and flip

Multifamily Lending Questions

Is there a prepayment penalty? + Sometimes lenders want to insure they receive the interest rate they're charging, so they may insert a prepayment penalty for six months to a year.
How soon can I get the funds? + Hard money funds can be received by the investor in 3 to 7 days once documents are back from title.
Can I get a hard money loan on my primary home? + Because of various federal laws and legislation, hard money loans are not offered on a primary residence.
What type of fees and interest rates should I expect?+ Fees will typically include origination points, underwriting, processing, appraisal, and possibly an environmental report fee. Interest rates range from 7-15%.