Financing is a key component to purchasing a multi-family property. As you start evaluating options, it’s important to know that not all lenders are created equal. Here are some multi-family financing tips to keep in mind and to ensure a smooth investment purchase.
1 – Find a Reputable Lender
With so many commercials and ads for online banks, it’s easy to get wooed. It also seems simple,… you fill out a quick form online and get offers from multiple lenders. What you don’t realize is that you’ll receive a barrage of emails, phone calls, and text messages from so many sources that it’s hard to keep it straight. It can quickly become overwhelming and stressful.
Now compare this with selecting a reputable local lender. You receive contact from just one company but can still compare various options. You still receive the benefit of a comparing prices since many lenders also broker loans for other companies, but without the hassle of multiple contacts. As you can imagine, it’s a more pleasant experience.
2 – Carefully Select Your Loan Officer
Working with a good loan officer is equally important. With online lenders, you may call into a main line and get assigned to the next available representative. You might get a different person each time you call. You’re just another record in their massive queue and may find yourself relaying the same information each time you call.
When you work with a dedicated loan officer, it’s quite the opposite experience. You can contact that person any time for assistance. He/she knows your information and can provide personalized attention and support. Your loan officer is a critical resource and partner at different stages of the home buying process.
3 – Get Pre-Approved
Once you select a lender and a loan officer, it’s time to get pre-approved. This means pulling your credit scores and verifying income. Only then will you have a solid pre-approval. This also gives you a better sense of how much you can afford and what you should do to prepare for a purchase.
4 – Touch Base Before Making Offers
The mortgage market has been a bit volatile lately with interest rates changing daily or even multiple times throughout the day. It’s a good idea to touch base with your loan officer before making an offer. He/she can re-run numbers for you based on current interest rates and the taxes for a particular property. With low inventory and heightened competition, updated figures will also show how much room you have to negotiate before reaching your maximum.
Summary of Multi-Family Financing Tips
Selecting a good real estate agent is necessary to find and negotiate a property purchase. Choosing a good lender is essential to completing that transaction. Remember that quality of service and level of communication are directly tied to the lender and loan officer that you choose. Keep the above tips in mind to simplify your purchase of a multi-family investment property.