What is a Multi-Family Loan?

Federal Housing Administration loans (or FHA loans, for short) are hugely popular for first time homeowners. From low closing costs and low down payment requirements, to reasonable credit qualifications, the advantages to consumers are numerous.

It’s less commonly known that, in addition to assisting people in financing single-family dwellings, FHA loans also exist for multi-family homes such as duplexes and small apartment buildings. The same things that make FHA loans appealing to typical homebuyers also makes FHA multifamily loans appealing to those looking for an investment property. Hurst Lending offers FHA multifamily loans in Texas and across the U.S.

An FHA multi-family loan is a great way to break into real estate, in Texas or elsewhere. This is in large part thanks to the low interest rate and reasonable down payments. You can get an FHA multifamily loan with as little as 15% down. Additionally, in some cases lenders are able to break the down payment into two separate payments – 7.5% up front with a 7.5% promissory note, which commits you to paying the remainder within a few weeks.

If you are looking to become a landlord, an FHA multifamily loan could be right up your alley. Many people here in Texas will use a multifamily loan to purchase a small, three or four apartment building and rent out all the units. Even after taking into account property taxes, utilities, upkeep, and the mortgage, an investor can still generate a sizeable amount of revenue each month as a landlord. FHA multifamily loans are also available for duplexes. In Texas it is not uncommon for an investor who purchases a duplex with an FHA multifamily loan to live in one unit and rent the second to offset the costs of maintaining the home.

Overall, FHA multifamily loans are a great way to break into real estate investment in Texas or anywhere in the US.  They are one of the most flexible, alternative ways to get funding for a larger investment.

It is important to note that FHA loans come in different varieties. Specialized FHA loan programs exist for multi-family acquisition or new construction, as well as skilled nursing/ assisted living new construction or acquisition. Things like the Loan-to-Cost percentage, Amortization term, and Debt Service Coverage will vary from situation to situation. Get the details on FHA multifamily loan programs here.

If you think that a FHA multifamily loan may be for you, or are simply interested in more information, please feel free to call us at 877-292-7350, extension six.  We can help with Texas multifamily loans or FHA multi-family loans across the US.