If you are interested in expanding your income by purchasing a property, you may have considered a multifamily complex. A multifamily complex is a home with up to four units that is considered a residential property. They are different from duplexes, which only have two units, and commercial properties, which have more than five.
There are many ways to secure funding for a multifamily complex, but one of the most common ways to do it is by getting a loan. Agency loans are available for those seeking to purchase a multifamily home, and they represent a large portion of multifamily mortgages. Investors can use these types of loans to purchase or refinance multifamily properties.
If you are not interested in agency loans, you can always apply for a traditional bank loan. Traditional bank loans are possible, but they are very difficult to obtain for multifamily properties. They are also recourse loans, which means that if the loan is not paid properly, the bank can go after the property and the borrower’s assets.
Finally, you may also have to apply for a bridge loan. A bridge loan is a loan that literally bridges the gap while you wait for a permanent loan to come through. These loans often have high-interest rates and can be for 18 months to two years with an option for an extension. If you are concerned about achieving proper financing, a bridge loan can give you peace of mind while you apply.
If you are interested in acquiring a multifamily complex, the loan process can be very overwhelming. Aspen Commercial Lending can help you navigate the process and help you obtain the financing you need.