Multi-family investments are powerful financial ventures that allow you to generate consistent cash flow. If you own this type of property, you can live in one unit and rent the others. The interesting thing is that if you buy the property through mortgage, you could use the rental income to service the loan.
With Freddie Mac small balance multifamily loan, bmfcap.com says you can finance your multi-family unit easily. All you need is to understand how it works and if it’s the right choice for you.
What to Know When Getting a Multi-family Loan
- Know the Popular Rental Properties in Your Area – To get high market value and consistent rental income, it would be ideal to know what your potential tenants prefer. For instance, duplex and condominium styles are more popular in today’s generation.
- Know the Size of the Units – Depending on the location, space and sizes can dictate your rental income. In fact, you may find more tenants in a one-bedroom unit than a three-bedroom unit because your area is close to the CBD.
Requirements for Multi-family Loans
Anybody who wants to apply for a multi-family home mortgage needs to have a good credit score, preferably above 740. Gift money is acceptable as a down payment for FHA borrowers, while conventional borrowers need to use their savings as down payment.
Is a Multi-family Loan a Good Investment
- You can use the rental income to offset property costs as well as generate some profit.
- You can get tax incentives. Depending on the location, tax incentives differ for multi-family properties. The government offers such tax advantages since you are providing housing to people who would otherwise not get it.
- Efficient management. Ideally, it is easier to manage several units under one roof than several units in different locations.
If you had not thought of multi-family home investment, it’s now time to see it as a great investment option. Why not try it now and discover its benefits.