4 TYPES OF MULTIFAMILY FINANCING
There are four common multifamily financing options available to real estate investors who are looking to purchase or renovate a property with between 2 – 200+ units. Each of these loans have their own unique terms, rates, and qualifications.
The four multifamily financing option are:
- Conventional Mortgage – Terms between 15 – 30 years. Loans are capped at 80% LTV and typically have interest rates between 4% – 6%.
- Government-Backed Loan – Terms between 5 – 35 years. LTV capped at 87%. Interest rates between 3% – 6%.
- Portfolio Loan – Terms between 3 – 30 years. LTV of up to 97%. Interest rates from 3.70% – 5.70%.
- Short-Term Multifamily Financing – Terms between 1 – 3 years. Interest rates of 4% – 12%. Monthly payments are typically interest-only.