Duplexes, triplexes, and fourplexes are more challenging because if someone is trying to buy one they are likely doing so because they want to make money off the property by renting it to other people. This makes “-plexes” investment properties, and banks are more stringent in lending on income-producing properties. The good news is that if you plan to live in one of the units, you may be able to get an FHA or a VA loan, and FHA and VA loans are easier to get approved than a commercial loan. If you are looking at a duplex, triplex, or fourplex as both a residence and an investment property, this is a great way to get them approved for the loan. Multi-Family Properties: These properties are where there are more than four units to any one complex. In other words, there is no “fiveplex” — once you go over four units, you now have a multi-family property. Obtaining a loan for a multi-family property is vastly more complicated than any of the “-plexes.” This is because a multi- family property needs a commercial loan instead of a residential loan, even if you intend to live on property. The transaction will not be FHA, VA, Fannie Mae, or Freddie Mac. This is a commercial loan and a whole different ball game. If you are purchasing a multi-family property, make sure the loan officer you work with understands multi-family loans and all the requirements one needs to get the loan approved. Otherwise, you’re better off working with someone else — a different lender who knows what they’re doing and knows the ins-and-outs of this complicated type of loan. As a commercial banker and mortgage broker, I have years of experience working with multifamily loans.
Vacant Land / Vacant Lots: One would think that buying a piece
66
Powered by FlippingBook