You can consider applying for a loan if you want to purchase a home. However, if you take a loan for an exclusive house, both the loan amount and interest rate will be much higher. You can opt for a multifamily loan to cut on high rates. More home buyers are considering Freddie Mac small-balance multifamily loans because of their competitive interest rates.
Bonneville Multifamily Capital shares some of the attractive benefits of applying for a Freddie Mac small-balance multifamily loan.
Lower loan value
Since apartments are less expensive in comparison to exclusive homes, purchasing a multifamily home is slowly gaining popularity. As the principal amount will be lower, repayment of the loan will be easier.
Competitive rates of interest
Like all other home loans, the HUD FHA 223 (f) loans are available for both floating and fixed rates of interest. So if you want to consider taking a loan that does not have a fluctuating rate of interest, you can go for a ‘fixed interest rate loan’. The interest will depend on the volatility of the market if you choose a floating interest rate.
The multifamily loans are much easier to refinance in comparison to the exclusive home loans. And if you are finding it difficult to repay the loan or you want to shift to the fixed interest rate within the stipulated time, then you can easily refinance your multifamily loan.
The multifamily loan has no geographical constraints. You can apply for the loan from wherever you stay and can purchase an apartment anywhere you desire.
With these advantages, It is easy to see that a multifamily loan is a great option for a first time home owner. Do your research and find out if this option also works for you. And if it is, get a reputable lending company to help you with the loan process.