Mortgage applications - single or multifamily?

Question

Hi!

I'm about to apply for a mortgage with several lenders to shop the best rates. However, I started in on the first application and have to select either single or multifamily. I'm open to both at this point and it's more of a question of what's available and what the numbers look like.

If it's a SFH I'm open to house hacking, but in a perfect world I'd get a multifamily. Should I just choose multifamily on the application? Are the rates similar? Should I ask for rates for both after I submit for one? I was reading that the approval process on a multifamily mortgage is more stringent, so I'm guessing I should start there (?).

Thanks for taking the time to read this! I've obviously never done this before. :)

Joseph Cacciapaglia · Answer

If multifamily is your preference, then you should definitely start with that. You can always fall back to SFH. For 2-4 unit owner occupants, the process and rates are not much different at all.

Lupe Camacho · Answer

Re-reading my initial post, I'm realizing I worded my intentions in a strange way.

I am 100% looking for a house hacking rental-type situation. However, the multifamily market is somewhat slim pickings in Portland, OR right now. If the opportunity should present itself that a SFH pops up that I could house hack to reduce or eliminate my living expenses and save for another property, I've been considering doing that.

I don't want to be on the sidelines waiting for too much longer as my rent just went up — I'm wanting out.

You all are definitely inspiring me to stick with the multifamily from the get-go. I'll just keep saving and searching.@Sandy Gabin that's brilliant! I'm following you now so I can learn all your secrets; you're doing exactly what I want to be doing.

@Manny Cirino thanks for the tip! I submitted 3 applications yesterday. Two were recommended by my realtor, and the third is with my credit union. Hopefully no shady business, but I'll be going through the docs with a fine tooth comb.

Lupe Camacho · Answer

Thanks @Joseph Cacciapaglia! Appreciate your help

Manny Cirino · Answer

You should definitely start with multifamily! That will allow you to eventually move in to the sfr of your dreams. The loans are no stringent they just vary from property to property because the cash flow changes.

Also know when shopping around for lenders anyone who advertises no lending fees usually has higher interest rates. They stick you with a higher interest rate, earn a higher commission and use that to cover your lending fees. Avoid them all together.

Sandy Gabin · Answer

@Lupe Camacho Go with multifamily! House hack so you you can buy the next one! I house hack on a 4 family and continue to buy more. 2020 is my year!

Mortgage applications - single or multifamily?

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