I understand in obvious situations, like a duplex is a two family. In my particular situation, it effects our financing opportunities. The bank will not lend on more than a 2 family, and our terms change if it is a single family.
More than a few we are looking at could "qualify" different ways under different circumstances.
Is a 3 unit with 2 street numbers (but one is A & B making 3 units), and one unit unfinished, able to be considered a 2 family? It clearly was at one point.
Or how about a lot with two houses but one street address, and one needs to be finished to be rentable, but is being marketed as a multi-family?
Is there anything that can be done to help sway these decisions either way?
It is usually determined by the zoning, not the current use. So if my property is listed with the county as a 4 unit and 1 unit is gutted, it is still a 4 unit
I have a legal duplex that is laid out as a SFH and it will always be considered a duplex unit I get a zoning variance.
Truth is, it is kind of a toss up. It will depend on how it is zoned (just like @Brie Schmidt said), the lender guidelines and the individual underwriter making a decision on the file. Keep in mind that how the appraiser writes it up and the comps they use will affect the comps they use and, therefore, your value.
The agent at your lender should have the best answer for you.
An agent that works for a mortgage broker will have access to different lenders. They will contact the lenders and get the answers needed to package your loan correctly BEFORE it gets to the underwriters desk.
It's almost impossible to tell until you get into the nitty gritty. Depending on zoning you could have a duplex with an illegal mother-in-law addition. They could have gotten a zoning variance for it. You need to both find a good mortgage broker and ( hopefully through the mortgage broker) a good title company. They can help answer a lot of these questions.
I would look for a new bank. I had to talk to quite a few before I found one that would lend on 3 and 4 family, but they are out there. The terms are slightly different, I have to put 25% down instead of 20% since it is multifamily, and after 4 loans it will be 30%. The interest rate is .5% higher since it is an investment loan, but worth it for a 30 year fixed rate loan.
Try MB Financial- you can talk to @Jerry Padilla , he has been great to work with!
Just as others have said it is determined by zoning, and appraiser primarily and the underwriter makes the decision as well, if they have questions.
Here is some general guidelines on financing your investment, hopefully this helps.
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