FHA Financing for 5 Units and up in blighted area?

5 Replies

Does anyone, investor, banker, or broker or loan officer on here, have experience dealing with larger apartments where government financing is available because the area is low income, high crime, or blighted? I am currently investing in an area like this and I want to look into financing on properties that are more than 5 units.

Can anyone point me to threads, blogs or companies that have info on this niche?

Thanks,

Chris 

Chris,

In D.C. they have gov't programs, similar programs exist in Baltimore. Try to call a local city property management company. Call your city office to see what programs.

@Christopher J Lemmon

Anything over 4 units will need either commercial lending, seller financing or private equity.  Generally, it will make more sense to go with a 4 unit over a 5 unit, because a commercial loan will have at least a point higher interest rate.  You would have to analyze the difference in cost spread where it makes sense going commercial based on the number of units compared with the interest rate.  Also, the term of a commercial loan will be shorter typically...10-15 years.  If you need a commercial or residential lender referral, PM me.

@Dan Bernstein, do you specialize in blighted, impoverished, and run down neighborhoods? I am not looking for the typical commercial loan program.
I know that FHA on the consumer side limits units to 4. What is less well know and info is scant on this is that HUD actually does have loans for low income multifamily housing.

That is what I am looking for info on. It’s been mentioned in at least one BP podcast. But I have not been able to find that podcast after listening to it 6 months ago. Info on the internet is hard to find about this, that’s why I posted. Thanks for your reply.