What is an Apartment Lender Inspection?

What is an Apartment Lender Inspection?

Apartment lender inspections commonly occur before the closing of a multifamily loan and occur at specific stages during the construction financing process. Here’s how to prepare.

Physical Vacancy vs. Economic Vacancy: What's the Difference?

Physical Vacancy vs. Economic Vacancy: What's the Difference?

When determining whether to invest in a commercial property, it’s essential to look at the property’s vacancy rate. There are two major types, or methods, of measuring vacancy; economic vacancy and physical vacancy. Economic vacancy represents the rental loss a property owner experiences due to vacancy over a certain time period, while physical vacancy represents the percentage of units that are vacant over a specific time period.

The Top 10 Fannie Mae DUS Lenders of 2021

The Top 10 Fannie Mae DUS Lenders of 2021

Fannie Mae originated nearly $70 billion of multifamily loans in 2021, most of them through its delegated underwriting and servicing (DUS) program. Founded in 1988, the Fannie Mae DUS loan program allows specially approved lenders to underwrite, close, and sell multifamily loans to Fannie Mae without prior Fannie Mae review.

How to Find Apartment Buildings for Sale: An Investor Guide 

How to Find Apartment Buildings for Sale: An Investor Guide 

When it comes to multifamily investing, half of the battle is determining the right property to invest in. No matter how skilled you are, choosing the wrong property will generally lead to a negative investment outcome, whereas a great property can be profitable, even for the unskilled investor.

Accretion, Reliction, Accession, and Avulsion in Real Estate 

Accretion, Reliction, Accession, and Avulsion in Real Estate 

Accretion, reliction, accession, and avulsion are all terms that involve changes in the size of property due to movements of water and soil. Accretion and reliction involve increases in land area, while accession and avulsion refer to reductions in land area.

Mortgage Constant and How to Calculate It

Mortgage Constant and How to Calculate It

Mortgage constant, or loan constant, is a metric that compares the annual debt service of a prospective commercial real estate loan to the entire loan amount. The mortgage constant is sometimes referred to as loan cap rate or mortgage capitalization rate.

Industrial Cap Rates: What Investors Need to Know

Industrial Cap Rates: What Investors Need to Know

If you’re an industrial real estate investor, looking at the current market cap rates of potential investments is often an essential part of the underwriting and investment selection process. In today’s market, industrial cap rates are among the lowest of all asset types.

What is Cap Rate Spread in Commercial Real Estate?

What is Cap Rate Spread in Commercial Real Estate?

Cap rate spread is the difference between the cap rate of commercial properties and current interest rates, typically measured by the 10-year Treasury Rate. Cap rate spread is an important indicator of risk, as U.S. Treasury bonds are considered virtually “risk-free,” while real estate investing involves a considerable degree of perceived risk.

90% LTV Multifamily Loans

90% LTV Multifamily Loans

When it comes to multifamily financing, most loans are capped at 75-80% LTV. However, some HUD multifamily loans, Fannie Mae multifamily loans, and hard money loans offer up to 90% LTV for qualified borrowers.

Freddie Mac Mixed-Use Property Guidelines

Freddie Mac Mixed-Use Property Guidelines

Freddie Mac allows mixed-used properties, provided that the property’s commercial income does not exceed 25% of the property’s gross income. In contrast, Fannie Mae requires that no more than 20% of a building’s net rental space be allocated for commercial purposes and that no more than 20% of a property’s effective gross income comes from commercial space.