What's the word for...

[Amy Fulbright]

I understand you can get a mortgage that's backed by the government for up to 10 sfh/residential rentals (each one up to a quadplex). 

What financing is available after your first 10 rentals? What's the phrase for that kind of financing?

[Chris Mason]

Originally posted by @Amy Fulbright:

I understand you can get a mortgage that's backed by the government for up to 10 sfh/residential rentals (each one up to a quadplex). 

What financing is available after your first 10 rentals? What's the phrase for that kind of financing?

"Portfolio" loans are a bucket not bound by Fannie/Freddie guidelines, but that follow the relevant laws/regs. Typically these have tighter standards, for example they might go over 10 (ignoring a Fannie rule), but not count rent unless it's been on 2 years of tax returns (more restrictive than Fannie), and might only go to 43% DTI (more restrictive than Fannie). So it might be more lax in one way, but it'll be more restrictive in a few other ways to compensate. These might still have Fannie-like interest rates, and might involve bundling such as "sure, we'll do that... if you move that $200,000 from your retirement account over to a retirement account managed by us."

"Non-QM" loans are a bucket not only not bound by Fannie/Freddie, but that fail some of the Dodd Frank compliance tests (f. example: "does the loan balance go down when the borrower makes a payment?"). These are also your "bank statements instead of tax returns to document income" loans, as well as your "cashflow based" loans (in this case, you might find minimum 1.1 DSCR).

"Commercial" loans aren't in the residential financing world at all. Note that commercial lenders will generally not review your transaction or quote a rate, or anything else, until the property is in escrow (1.25 DSCR is normal minimum).

All three will get you around the Fannie cap of 10. So will a HML, I'm sure you already knew that.