Multi-Family Apartment Loans

There are a number of different multifamily apartment financing programs available. They are generally divided into small apartment loans for properties costing between $1 million and $5 million, mid-balance loans for transactions between $5million and $25 million, and large financing programs lending for transactions with no specified upper limit, and a bottom limit of $2 million.
Small multifamily apartment Financial Consultant Vs Financial Analyst financing
The Fannie Mae loan program offers financing for multifamily apartments with more than 5 rental units. The loan amounts are between $750 thousand and $3 million dollars and have terms of between 5 and 30 years. Another option in this category is a multifamily FHA loan, which is administered by HUD. These government loans are attractive because they do not depend on the volatility of the market. The source of financing remains in place because it is government allocated and controlled. Small conduit multifamily apartment mortgages are also available from 1$ million to $5 million and terms of 5 to 20 years.
Mid-balance and large multifamily Corporate Money Management apartment financing:
The same basic categories apply to mid-balance multifamily apartment financing as noted above. There are the Fannie Mae programs, FHA loans, and small conduit loans for these monetary ranges. There may be other types of loans available in addition to these so ask your loan broker about the programs they recommend.
How to get approved for multi-family apartment financing:
Specific programs have their own criterion for borrower approval. These lenders base their decision both on certain criteria that the borrower must meet and stipulations for the multifamily apartment being purchased. An example will serve to illustrate this.
Let’s say you are trying to take out a small multifamily apartment loan under the Fannie Mae program. They require that your FICO credit score be higher than 680, and that you have a minimum of 2 years’ experience with 2 multifamily properties. They also require that the post closing liquidity (that is, the amount of cash you will have after purchase of the apartment building) is equal to or greater than the loan amount.
As concerns the property itself, it must be able to demonstrate an average 90% occupancy in the 12 months prior to receiving the loan and it must have 5 or more rentable apartments. The properties are also restricted in most cases to 25 year amortization schedules.
Multi-family apartments are a good real estate investment in these troubled times. The demand for multifamily housing remains fairly steady and the existence of multiple players (i.e. the borrower, tenants, lenders, and possibly government sources) in the cash flow patterns of the transaction distinguish it from other lending and borrowing markets. So if you are thinking of getting into real estate investment, this is a potential area to consider.

READ  Same Day Loans - Quick Loans For Small Expenses