Purchasing our First 2-Unit

[Greg Dunkle]

Hey all, first post here.  I'm happy to say that my wife and I just had our offer accepted on our first 2 unit.  We are doing an all cash deal with a relatively quick closing.  Both units are occupied with long term tenants.  

My question.. We want to get a mortgage on the property after completing some deferred maintenance so we can rinse and repeat. What type of loan would that be called?  What should I look for when considering financing and what should I steer clear of? 

[Michael K Gallagher]

Hey Greg, not knowing too much about the property, but in general a 2 unit would qualify for a conventional fannie freddie loan. Depending on your lender the rates/terms will change but generally its going to be an 75-80% ARV loan and rates that I'm seeing for my clients on investment loans are in the 3.4-3.8 range at the moment. If you are buying cash, there really should not be a seasoning period that you need to abide by, but you'd want to get all the work done that you have identified so that the appraisal comes back as strong as it can.

In addition to approaching good mortgage broker in your market for this, I'd also recommend reaching out to any local credit unions you might have in your area.  They tend to be able to offer "portfolio" products where they actually service the loan themselves, and they can usually be more creative if need be.