people. This makes “-plexes” investment properties, and banks are more stringent in lending on income-producing properties. The good news is that if the buyer plans to live in one of the units, they 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 your buyer is 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 the buyer intends 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 your buyer is 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. Vacant Land / Vacant Lots: One would think that buying a piece of land with nothing on it would be the easiest loan to obtain. However, it’s actually incredibly difficult. Banks prefer not to loan on vacant land because the market is so much smaller. Furthermore, if there are issues after the lot purchase, the buyer is more likely to simply walk away because there is nothing there
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