5/1 ARM on investment property

[Andrew Patterson]

Currently have two SFH rentals and looking to jump to multifamily. Second rental was purchased this year on a 30 yr fixed. Called the same lender and had a lengthy conversation about scaling up and etc. and requested a prequal letter. The prequal letter he sent was for a 5/1 ARM. I asked for some clarification on that and he said all investment properties are 5/1 ARM. This is not being financed as a commercial loan, this a personal loan. Can anyone offer advice in this situation? I think there are too many unknowns to be getting into a gambling situation with interest rates 5 years from now. Any input is appreciated. This is a local credit union where I live. Thanks!

[Robin Simon]

Quote from @Andrew Patterson:

Currently have two SFH rentals and looking to jump to multifamily. Second rental was purchased this year on a 30 yr fixed. Called the same lender and had a lengthy conversation about scaling up and etc. and requested a prequal letter. The prequal letter he sent was for a 5/1 ARM. I asked for some clarification on that and he said all investment properties are 5/1 ARM. This is not being financed as a commercial loan, this a personal loan. Can anyone offer advice in this situation? I think there are too many unknowns to be getting into a gambling situation with interest rates 5 years from now. Any input is appreciated. This is a local credit union where I live. Thanks!

 I mean maybe for this specific Credit Union lender they might only do 5/1 ARMS on investment properties but that is far from a "rule" in financing, there are plenty of lenders who will finance your rental properties out there with a 30-year fixed rate loan if you shop around even a little bit