Five Useful Tips When Applying for a Multifamily Loan
Multifamily financing is a mortgage involving buying or refinancing large apartment buildings with a minimum of five units and smaller properties with at least two. Multifamily loans are a good option for both veteran and newbie real estate investors and professionals. Terms may extend up to 35 years and rates between 4.5 percent and 12 percent.
If you’re in search of a permanent multifamily loan for rental units, below are five handy tips you should consider:
1. Apply as soon as possible.
Any knowledgeable loan officer and underwriter will always expedite the process, beginning with the inquiry up to the funding. It isn’t the case all the time, but usually, there are problems along the way that lead to delays. For instance, the underwriter may have backlogs to clear or the borrower may have incomplete documentation. Therefore, it’s always best to begin the process early.
2. There are several options.
We just want to be clear about the fact that there are options, from banks to life insurance firms to private sources and more. Knowing you have options widens your perspective as you decide which one is the best for you.
3. As soon as your loan is approved, lock your interest rate.
This may sound basic or perhaps even trite, but as soon as your loan is approved, lock that interest rate. We all have a take on which direction the rates will go, but does anyone really know with certainty? If you’ve come as far as to actually get approved for a loan, your best action is to lock your rate and quit the stressing. This frees you of worries over risky rate movements, and move forward knowing your rate.
4. Know what differentiates market rate from affordable rent.… Read More..Read More →