Hard Money Loans 6%-9%
Financing is based on the value of the property you want to finance, as funding comes from private investors rather than a government-backed loan program. By focusing on the merit of the deal, rather than your credit score or certain property restrictions, approvals are fast and simple. Although interest rates are higher, term lengths are shorter and you can refinance to another loan type. *see disclosure at the bottom of page
Freddie Mac Optigo 3.20%-4.82%
Government-sponsored Freddie Mac created Optigo to form a network of lenders who can finance projects beyond what conventional loans cover. This provides more options for specific investment scenarios but also involves extensive qualifications, added fees, and a long approval process. Loans can be used for the acquisition, refinance, or moderate rehabilitation of multifamily properties, including affordable, student, and senior housing.
HUD 223 (f) 2.35%-2.75%
HUD 223(f) is part of the US Department of Housing and Urban Development’s Federal Housing Administration Multifamily Housing program. It helps borrowers purchase or refinance existing multifamily rental housing, with limitations for properties that require substantial rehabilitation. It may require certain property conditions and repairs to be met before approving financing and comes with cash-out limitations, insurance premiums, and additional fees.
HUD 221(d)(4) 3.15%-3.4%
Another of HUD’s FHA Multifamily Housing programs, HUD 221(d)(4) backs lenders in providing borrowers with financing for the new construction or substantial rehabilitation of multifamily rentals for moderate-income families, the elderly, and the handicapped. It has various limits related to rental unit sizes, structure types, and property location and often involves extensive documentation and a long approval process.
