Multifamily Financing and Apartment Financing are available through HUD/FHA and Fannie Mae DUS but there also non-government alternatives to these programs. Sometimes the frustration and time delays associated with the long arduous approval process of multifamily financing through HUD, FHA, Fannie Mae and other government programs can be averted by using alternative programs.
Consider that most commercial investors use HUD/FHA and Fannie Mae DUS style multifamily financing because of the low rates more-so than for the high LTV and all of the sudden multifamily financing and apartment financing with equally low rates and faster closing times with easier approval processes become very attractive. There are only slight differences in the government sponsored programs and the market-oriented multifamily financing alternatives.
For instance, HUD and FHA programs can have LTV structures as high as 90% where Fannie Mae DUS programs can have lower stabilization requirements. The bottom line is that most commercial investors in need of multifamily or apartment financing for the purpose of refinancing, don’t need to bother with either of those government multifamily financing programs and can use HUD and Fannie Mae DUS alternatives.
With programs with LTV’s as high as 75% and equity providers willing to provide Mezzanine loans for multifamily and apartments we can provide equity of mezzanine loans that cover any shortfall. Say a borrower needing multifamily financing or apartment financing in Atlanta, GA or Phoenix, AZ needs an LTV as high as 83%. The appropriate strategy would be to provide a senior loan at 65% LTV with a rate as low as 3.6% with a 25-year amortization and an equity loan of 18% to cover the shortfall. The equity loan could be structured as an investment or as a mezzanine loan without a buyout in a 3 year period or a waterfall that eliminates the third party provider over a period of time.
The bottom line is that after 3-5 years the commercial investor is left in a better place than taking on the highly leverage, government sponsored loans because they have a safe, long-term, low-rate multifamily financing solution that gives them higher returns over the life of the investment .. not to mention the fact that this multifamily financing and apartment financing structure can close in a much more timely manner with far less hassle.
For information on how to close quickly on low-rate, long-term multifamily financing and apartment financing contact the experts at Dividend America Commercial Lending. Dividend America is a non-bank lender that specializes in providing commercial investors with lending solutions, not just loans!
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