Multifamily Loans

Depending on the type of property you want to purchase as an investor or just someone trying to use it for personal needs, you will need a specific loan that can finance it and establish terms based on that. Therefore, for properties with several units that can be used as residences, rely on multifamily loans instead of residential ones.

Residential loans are often used to purchase, renovate, or remodel homes and apartments. However, they do not finance large buildings or spaces with more than one unit.

Now, what are multifamily properties in specific? Just places with more than one unit or space? That describes 90% of the property. However, to be more specific, those properties consist of at least 2 units, which means you do not have to go for large properties or buildings to classify them in this category. Also, the units are used for residential needs only.

This is why the name “multifamily” is given, because more than one person or lives in them by occupying one of the units. That being said, why would you want to invest in them? If you are a real estate investor that is not only interested in purchase and reselling but also renting, you will find them quite profitable. First, they allow you to have your own residence or space while the rest of the units can be rented or you can decide to rent the entire property.

Second, you can also buy, renovate, and resell it for usually much more than the initial price you paid for it. Finally, you might just want to have a new space to live in and use another—or several units—to finance part of the loan you requested for it. Whatever your situation is, focus on requesting multifamily loans. Otherwise, you will not have the same benefits that can help you to speed up the repayment process, have better terms after accessing the loan, and maybe fewer requirements to apply for it in the first place.