When you’re ready to finance a multifamily property, the last thing you want to know the different options you have available and what documentation you will need for each of them, no matter what you decide. Having the right options when your financing a multifamily home can make the difference between a very smooth commercial real estate loan experience or a very start and stop process other loan companies are known to provide.
By using state of the art commercial underwriting pricing index data (CUPIDTM), some companies can provide you with commercial Federal National Mortgage Association (Fannie Mae) multifamily financing at the touch of a button. It’s that easy to sift through and process hundreds of lenders and loan programs that fit your specific multifamily loan needs best. Read on if you want to learn about the different types of Fannie Mae multifamily and commercial real estate loans.
Fannie Mae Multifamily
Fannie Mae has a variety of options when dealing with multifamily and apartment financing. These options include multifamily loans that are non-recourse, offer you a 30-year fixed-rate financing deal offer up to 80% leverage. Fannie Mae Multifamily and commercial real estate loans have almost all commercial investors seeing the viability of these commercial loans.
That being said, Fannie Mae defines multifamily housing as any rental housing that has five or more dwellings within it. These units can be one room-efficiencies, or it can be a two-story garden apartment attached to another garden apartment. There is a standard feature most of the commercial multifamily units share, and that is no matter the size, shape, or what extra amenities the apartment offers, it is home to its residents.
The Fannie Mae multifamily guide below offers real estate investors a one-stop shop informational guide to commercial real estate loans in a consistently straightforward manner.
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If you ever thought there was limited money to be made as an investor in commercial real estate or multifamily real estate loans, the top five multifamily affordable housing DUS lender companies , a couple of the top five made over $8.1 billion.
It’s a long-held and known investor truth that apartment and multifamily building investors have some of the best rates and terms with some rates being fixed for five to thirty years. But like all proper investment criteria, there are structured guidelines that go along with multifamily loan financing, and you need to know those guidelines if you want to wade into the commercial real estate market.
Commercial Real Estate Loan Financial Rewards
A multifamily property commercial loan offers various financial rewards to investors, and any other type of investment cannot receive many of these financial rewards.
- If you finance a multifamily home or property, it’s an innovative opportunity to generate income from one side of your investment from a unit you’re renting out. While providing you with passive income from a unit you’re living in but not having to pay rent while living there although your mortgage and other property payments will need to be made in kind.
- Another way the investor has more control over the value of their investment is the more income a property receives, the higher the value is. That means multifamily properties give investors streams of income. This is always rated of higher value than a single-value home.
- Every time someone moves out of one of your single-property homes as an investor, you lose money. But as a multifamily and commercial real estate investor, your loan is secured through the larger pool of tenants. When you consider it, you come to the realization its a win-win when you have numerous units that help you lower your loss concerns as an investor when your loan note comes due.