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Commercial Loan Blog

By Terry Painter/Mortgage Banker, Author of The Encyclopedia of Commercial Real Estate Advice – Wiley Publishers, Member of the By Terry Painter/Mortgage Forbes Business Council

 

Buying multiple houses with a HUD/FHA loan for the purpose of renting them is not allowed. An FHA residential loan can be used to purchase a duplex, triplex or fourplex and renting units out is allowed as long as the applicant occupies one of the units. HUD multifamily will not finance 1 – 3-unit properties in any configuration. However, HUD will finance 2 or more contiguous fourplexes on one or... Read More

By Terry Painter/Mortgage Banker, Author of The Encyclopedia of Commercial Real Estate Advice – Wiley Publishers, Member of the By Terry Painter/Mortgage Forbes Business Council

 

The Minimum Loan Amount for the HUD 223(f) 

The minimum loan amount for HUD 223(f) averages around $3,000,000 – although HUD does not specify an exact minimum loan. HUD allows their approved lenders to decide this. Due to the over 400 hours that it takes a HUD lender to process, underwrite, apply for and close the 223(f), minimum loan amounts under $3,000,000 are not profitable. HUD does... Read More

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By Terry Painter/Mortgage Banker, Author of The Encyclopedia of Commercial Real Estate Advice – Wiley Publishers, Member of the Forbes Business Council

 

Highest LTV Multifamily Loans 

1.  HUD Multifamily Loans – 85% - 90% LTV
2.  Mezzanine Financing – 80% - 85%
3.  Freddie Mac Multifamily Loans – 80% LTV (Purchase & Cash-Out Refinance)
4.  Fannie Mae Multifamily Loans – 75% - 80% LTV (Purchase & Refinance - 75% on Cash-Out Refinance)
5.  Credit Unions – 75% LTV Purchase & Refinance with or without cash out
6.  ... Read More

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By Terry Painter/Mortgage Banker, Author of The Encyclopedia of Commercial Real Estate Advice – Wiley Publishers, Member of the Forbes Business Council

What is a Real Estate Syndication?

A real estate syndication is used when the sponsor of a real estate investment plans on combining the cash from multiple passive investors to raise funds for the down payment. In this case, Regulation D, of the Securities and Exchange Commission (SEC) mandates the sponsor form a real estate syndication.  Because the investor’s only role is to invest their money, the SEC views the... Read More

By Terry Painter/Mortgage Banker, Author of The Encyclopedia of Commercial Real Estate Advice – Wiley Publishers, Member of The Forbes Business Council

 

The 12 Disadvantages of HUD Multifamily Loans

*Takes a Long Time to Close *Older Properties May Have to be Remodeled *Higher Closing Costs *Monthly Replacement Reserves Required *Minimum Loan $3,000,000 *Working Capital Reserve for Construction *Annual Financial Audits  *Davis-Bacon Wages Required for Construction *Biannual Draws for Owners   *Mortgage Insurance Required *Large Amount of Paper Work. *... Read More

 

By Terry Painter/Mortgage Banker, Author of The Encyclopedia of Commercial Real Estate Advice – Wiley Publishers, Member of The Forbes Real Estate Council

 

17 Advantages of a HUD Multifamily Loan: 

 

*Highest LTV at 80 – 90% *1.176 DSCR Market Rents *Cash Our for Any Reason  *1.15 DSCR Affordable Rents *Unlimited Loan Size *Same Rate Construction Roll over to Perm *35 Year Fixed Rates *No Global or Debt to Income Ratio *40 Year Fixed Rate New Construction *Assumable *No Tax Returns Required  *Non-Recourse *Supplemental Financing Available... Read More

By Terry Painter/Mortgage Banker, Author of “The Encyclopedia of Commercial Real Estate Advice”. 

January 1, 2023

The Truth About How Long Term Commercial Rates are Determined

Sorry if this article starts out boring because I’m about to throw a lot of numbers at you. But before I do... Read More

March 23, 2023

By Terry Painter/Mortgage Banker, Author of: “The Encyclopedia of Commercial Real Estate Advice” Wiley Publishers

 

1997 was a great year for commercial property investors.  It was also the first year I started working as a commercial loan officer. If you can believe it, cap rates on multifamily... Read More

March 8, 2023

Why apartment building prices are going down

By Terry Painter/Mortgage Banker, Author of “The Encyclopedia of Commercial Real Estate Advice” Wiley Publishers

 

With home sales falling for the last 11 months of 2022, according to Yahoo Finance, prices continue to drop during the... Read More

September 6, 2022

Multifamily cap rates at an all time high

By Terry Painter/President, Apartment Loan Store – Author of “The Encyclopedia of Commercial Real Estate Advice”. 

 

I have worked as a commercial mortgage banker for the past 25 years and have encountered many surprises. But nothing that... Read More

By Terry Painter, Mortgage Banker, Author of “The Encyclopedia of Commercial Real Estate Advice" – Wiley Publishers. Member of the Forbes Business Council

 

When I started lending on Fannie Mae and Freddie Mac Multifamily loans back in 2004, I was surprised that these two loan programs had more terms and... Read More

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HUD Loans are one of the best options with the current level of interest rates. For a complete guide to HUD Multifamily Loans please go here:

HUD Multifamily Loans - The Complete Guide

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