Multifamily Hard Money Loans

  • Rates – starting at 8%
  • Term – from 4 months
  • No Upfront Cost or Contracts
  • Asset-based Lending

Multifamily real estate is one of the safest and popular investments among professional thanks to a stable income and low vacancy rates.  Buyers in the past used traditional financing, but more recently, multifamily hard money loans offer an alternative capital source for investors.  

Private capital works for investors because sometimes, you don’t have all the time in the world to secure financing.  Waiting for a bank to approve your loan, submitting endless paperwork just don’t fit well in a competitive environment where you need to move fast.  Hard money loans are the perfect tool for investors looking to close a deal quick.  Traditional loans from banks can take up to 45 days or longer, hard money loans can close in as fast as a week.  Once the deal is secured and the property purchased, the buyer is free to refinance the property with a traditional loan.

Another less known advantage of hard money loans for multifamily – flexibility.  Too often, we get buyers who just got rejected by a bank because the apartment building did not fit a ‘perfect lending’ criteria.  Investors and bank can look at the same deal and reach two vastly different conclusions.  Private lenders don’t have arbitrary lending criteria thanks to asset-based lending.  

Fast Approval

Traditional loans can take several months to close. We can do it in a few days

Low Rates

Rates start from 8% with low cost to close.  If we can find you a hard money loan you pay nothing

Up to 80% LTV

Access the maximum equity in your asset and unleash your investment portential

Hard Money Loans for Apartment Buildings

What is the commercial definition of an apartment building? The answer is not so clear for lending purposes.  In most states, a commercial apartment building is any apartment building with more than 4 units.  Duplex and triplexes in some states are not considered commercial properties, so there is a different criteria when you want to get a hard money loan.  

Apartment building are an ideal investment tool for those who want rent stability, low vacancy rate, and the potential for capital appreciation.  Average cap rate in large US cities is right around 5%, with strong markets such as Los Angeles are around 4%, and 4.6% in Seattle for 2015.  And because the cap rate is very low, it leads to faster capital appreciation in value of the property.  

The market for apartment building as an investment in good areas is very competitive – which means you need to use any advantage over the competition.  With a hard money loan to purchase an apartment building, you can beat other investors and make an all-cash offer.  

Common Questions for Multifamily Hard Money Loans ​

Here are the most frequent questions we get when it comes to hard money loans for multifamily:

Q: What can I do to increase my chances to qualify?

A: Make sure you have all of your paperwork ready – any underwriter will probably ask you questions about the property and about your experience as an investor.  This is the part that usually takes the most time, so be prepared ahead of time.

Q: Are the rates going to be really high?

A: Hard money rates are higher than traditional bank loans.  Since they are riskier, done faster, and require less underwriting, the rate is higher.  Typically hard money loans will be 4-5% higher than standard interest rates.

Q: Why should investors take a high-interest loans if banks give lower interest rates?

A: Banks take a long time to approve loans, and they often apply very rigid funding criteria to deals.  So if you have a special situation or circumstances, you may be out of luck.  Hard money loans are also perfect for buyers who want to close a deal quick, and can’t wait 45 days for a bank approval.  Hard money is not for everyone, but there are investors that are able to buy property not possible otherwise,  thanks to hard money loans.

Q: Can I qualify if I have bad credit?

A: Yes.  Hard money loans for multifamily is focused on asset-based underwriting.  This means that your credit score is less important than the strength of the property you are buying.  Your experience is still important, and a good credit score helps a lot – but burrowers with bad credit qualify for hard money loans all the time.

 

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