Houston apartment loans for multi-family, commercial properties are available through various lenders. These loans can be used to purchase either existing units or build new from the ground up. There are even some types of commercial-grade loans that allow for improvements. So, it’s important to understand the various products available and what you need to know about Houston apartment loans.

Houston apartment loans come in government-backed packages, as well as in private financing products. Three of the biggest names you’ll immediately recognize are Fannie Mae, Freddie Mac, and FHA. While these government agencies don’t actually loan funds directly, they do structure financing in particular ways. For instance, Fannie Mae’s apartment loans generally start at $750,000 and go up from there, with terms lasting up to 30 years in length. A down payment is usually around 20 percent, and interest rates are competitive.

Similarly, Freddie Mac commercial loans generally require 20 percent down or more, with terms of up to three decades, and competitive interest rates. However, these loans are usually larger, ranging from $1 million to $100 million. Then, there are FHA commercial loans, which likewise require approximately 20 percent down, however, loan terms can last up to 35 years, and the loan amount may be around 3 million or more.

Finally, there are two more options available. One is what’s known as a bank balance sheet apartment loan, while the other is a multifamily construction loan. Both of these are private and generally done completely in-house, meaning they are not government-backed.