There are four common multifamily financing options available to real estate investors who are looking to purchase or renovate a property with between 2 – 20+ units. Each of these loans have their own unique terms, rates, and qualifications.


REGISTER NOW FOR THE HARRIS VIP MASTERMIND EVENT! Tim & Julie are proud to announce the upcoming 2018 VIP Mastermind Event, in Georgetown, Texas. This intimate 50-person event featuring 12 special top-producing guest speakers and Tim & Julie Harris – winners of the coveted Inman “Best Of The Best” coaching award, #1 International Best Selling Authors of “Harris Rules”, and the hosts of Real Estate Coaching Radio! Register NOW for your early-bird discount!


The four multifamily financing option are:

  1. Conventional Mortgage – Terms between 15 – 30 years. Loans are capped at 80% LTV and typically have interest rates between 4% – 6%.
  2. Government-Backed Loan – Terms between 5 – 35 years. LTV capped at 87%. Interest rates between 3% – 6%.
  3. Portfolio Loan – Terms between 3 – 30 years. LTV of up to 97%. Interest rates from 3.70% – 5.70%.
  4. Short-Term Multifamily Financing – Terms between 1 – 3 years. Interest rates of 4% – 12%. Monthly payments are typically interest-only.

1. Conventional Mortgage for Multifamily Properties

Conventional mortgages for multifamily properties are permanent “conforming” loans offered by traditional banks and lending institutions. These mortgages are long-term with terms between 15 – 30 years. Conventional mortgages can finance multifamily properties between 2 – 4 units but can’t finance apartment buildings with 5+ units. Further, conventional mortgages can finance up to 4 – 10 investment properties at once.

Conventional mortgages are considered to be conforming because they typically adhere to Fannie Mae’s required qualifications and maximum loan amounts. However, conventional mortgages for multifamily financing aren’t backed by the federal government.

Multifamily Financing: The Ultimate Guide to Multifamily Loans

By Evan Tarver  | Real Estate Investing | Comments (10)

Multifamily financing is a type of mortgage that can be used for the purchase or refinance of smaller multifamily properties (with 2-4 units), and large apartment buildings that have many units. Multifamily loans are a good tool for both first time real estate investors and seasoned professionals.

If you’re looking for a permanent multifamily loan for rental units you can check out LendingOne. They’re a national lender that can finance 2 – 4 unit buildings up to 80% LTV. Terms are 30 years with fixed rates that start as low as 5.99%. Apply online today in minutes and see if you qualify.

4 Types of Multifamily Financing

There are four common multifamily financing options available to real estate investors who are looking to purchase or renovate a property with between 2 – 20+ units. Each of these loans have their own unique terms, rates, and qualifications.

The four multifamily financing option are:

  1. Conventional Mortgage – Terms between 15 – 30 years. Loans are capped at 80% LTV and typically have interest rates between 4% – 6%.
  2. Government-Backed Loan – Terms between 5 – 35 years. LTV capped at 87%. Interest rates between 3% – 6%.
  3. Portfolio Loan – Terms between 3 – 30 years. LTV of up to 97%. Interest rates from 3.70% – 5.70%.
  4. Short-Term Multifamily Financing – Terms between 1 – 3 years. Interest rates of 4% – 12%. Monthly payments are typically interest-only.

1. Conventional Mortgage for Multifamily Properties

Conventional mortgages for multifamily properties are permanent “conforming” loans offered by traditional banks and lending institutions. These mortgages are long-term with terms between 15 – 30 years. Conventional mortgages can finance multifamily properties between 2 – 4 units but can’t finance apartment buildings with 5+ units. Further, conventional mortgages can finance up to 4 – 10 investment properties at once.

Conventional mortgages are considered to be conforming because they typically adhere to Fannie Mae’s required qualifications and maximum loan amounts. However, conventional mortgages for multifamily financing aren’t backed by the federal government. Let’s take a moment to look at a conventional mortgage for multifamily financing in greater detail.

Conventional Mortgage for Multifamily Homes: Rates, Terms, & Qualifications

Conventional Mortgage for Multifamily Financing
Loan Amount
$100,000 – $1,200,000
(Maximum Loan-to-Value Ratio 80%)
Down Payment
20%+ Loan-to-Value (LTV) Ratio
Typical Interest Rates
4% – 6% Fixed or Variable
Typical Lender Fees
0% – 3% Loan Origination Fees,
2% – 5% Closing Costs
Typical Loan Term
15 – 30 Years
Typical Time to Funding
30 – 45 Days
Typical Qualifications
2 – 4 Unit Building,
Property in “Good” Condition,
680+ Personal Credit Score (check your credit score for free here),
DSCR 1.25+,
6 – 12 Months Cash Reserves