5+ Unit Apartment Financing

[Robert Dunbar]

Does one have to get a commercial loan for 5+ unit multifam properties? I saw a listing in my area for an 8 unit property. I chatted with the broker about the place and asked if it would take a commercial loan since it was more than 4 units on this property. He said no it would be conventional. Is a conventional loan doable on an 8 unit apartment complex?

Thanks for your feed back,

Robert

[Patrick O'Shea]

I don't know his definition of conventional, but 5+ unit property is a commercial mortgage (instead of residential). You'll work with a different department when it comes to the financing. You'll work with a commercial lender at the financial institution. Depending upon price, you'll likely be best off working with a local/regional banker or credit union. Big banks usually don't want to put the effort forth for a smaller loan when they can do the same amount of work for a loan of tens of millions. Good luck!