Texas Apartment Loans and Multifamily Financing $1,000,000+

Texas Apartment Loan Rates - Rates updated February 22nd, 2020

Multifamily Loan Product Rates (start as low as) LTV Amortization
5 Year Fixed 3.51% Up to 80% Up to 30 years
7 Year Fixed 3.67% Up to 80% Up to 30 years
10 Year Fixed 3.83% Up to 80% Up to 30 years

Select Commercial has excellent apartment building loan and multifamily loan products and options available for owners and purchasers of multi-family and apartment properties throughout the state of Texas. Whether you are looking to finance a small apartment building, a complex with hundreds of units, or a co-operative, we can help you find the optimal financing solution to meet your apartment mortgage loan needs. While we lend across the entire continental US, we are able to give our best rates and loan programs to certain areas that we feel are strong markets. Texas is one of the states that we consider to be a premium market for apartment building loans and we actively look to originate good quality loans here for our clients. We have a diverse array of many available loan products to help qualified TX borrowers looking to purchase or refinance an apartment property. We offer apartment loans with terms and amortizations up to 30 years, recourse and non-recourse, and many options for prepayment. We typically approve apartment building loans within 1 day and usually close within 45 days of application. Our clients love our simplified application process, 24-hour pre-approvals with no-cost and no-obligation, great rates and terms, fast closings and personalized service.

Texas Apartment Loan Benefits

Texas Apartment loan rates start as low as 3.51% (as of February 22nd, 2020)
• No upfront application or processing fees 
• Simplified application process 
• Up to 80% LTV on apartment financing 
• Terms and amortizations up to 30 years 
• Loans for purchase and refinance, including cash-out 
• 24 hour written pre-approvals with no cost and no obligation

Recent TRUSTPILOT Reviews

Select Commercial Funding Reviews from TRUSTPILOT

A three year journey
"Thanks Stephen for all of your hard work in getting our deal closed! I appreciate your professionalism and patience throughout a complicated process. You always were there for my partner and I whenever we had questions and needed answers quick. It was a pleasure to have worked with you and Select Commercial!"

Texas Apartment Loan Types We Serve

If you are looking to purchase or refinance a Texas apartment building, don't hesitate to contact us. We arrange financing in the state of Texas for the following:

  • Large urban high-rise apartment buildings
  • Suburban garden apartment complexes
  • Small apartment buildings containing 5+ units
  • Underlying cooperative apartment building loans
  • Portfolios of small apartment properties and/or single-family rental properties
  • Other multi-family and mixed-use properties

Multifamily Loan Outlook - 2020

Across the country, experts predict that the multifamily market should continue with its strong performance into 2020. There are several crucial factors that support this favorable prediction, a few of which are delineated below. While there are also a variety of political and financial conditions present that combine to add a level of uncertainty to the market, the positives are anticipated to outweigh the negatives for investors in the multifamily sector in 2020. Firstly, healthy and viable labor markets are expected to continue to drive the demand for multifamily housing. Continued growth in employment rates is expected to fuel new multifamily household creation. In 2019, employers were on pace to create over 2 million net new jobs, making it the ninth straight year where employment growth came in at or above 2 million jobs. Secondly, apartment rents have been rising incredibly fast over the past several years. Late in 2019, California passed rent control legislation. However, as the law allows for annual rent increases of about five percent, rent is still expected to increase significantly. Some of the realities driving rents higher in top markets include increases demand for multifamily housing, rising land and construction costs and an influx of higher-end, luxury projects coming to the market. With these conditions in place, landlords are going to find themselves making more in rental income in 2020.

Experts further predict that buying and developing in the suburbs will remain the best bet for multifamily investors in 2020. They expect suburban multifamily growth to outperform urban as it maintains lower vacancy rates and achieves higher rent growth. According to CBRE Research, the top four markets for multifamily performance in the coming year are Phoenix, Atlanta, Austin and Boston. These four metros are very high-growth cities when considering metrics such as multifamily demand, population and employment. Additionally, construction and development are very active in these markets. Smaller metros and cities should also maintain prominence in the considerations of investors and developers. While the risk of overbuilding may be higher in smaller markets, there are several markets that appear to be primed for exceptional multifamily performance. Many smaller metros are undergoing a significant development of their urban centers, thereby improving quality of life and helping them to retain their employment base. Of these smaller markets, seven metros had 4% or higher rent growth as of the third quarter of 2019 and are incredibly likely candidates for outperformance in 2020: Albuquerque, Birmingham, Colorado Springs, Dayton, Greensboro, Memphis, and Tucson.

Texas Apartment Loan Options

Our company has multiple capital sources for these apartment loans, including: Fannie Mae, Freddie Mac, FHA, national banks, regional and local banks, insurance companies, Wall Street conduit lenders, credit unions and private lenders.

Texas Apartment Financing with Fannie Mae (FNMA)

Fannie Mae’s multifamily loan platform is one the leading sources of capital for apartment building loans in the US. Fannie Mae is a leader in the secondary market – meaning they purchase qualifying apartment loans from leading lenders who originate these loans for their borrowers. Fannie Mae purchases loans secured by conventional apartments, affordable housing properties, underlying cooperative apartment loans, senior housing, student housing, manufactured housing communities and mobile home parks on a nationwide basis. The Fannie Mae platform has many benefits, including:

  • Long term fixed rates and amortizations. Fannie Mae allows terms and amortizations of up to 30 years. Most banks offer only 5 or 10 year fixed rates and 25 year amortizations.
  • Non-recourse options. Most banks will require the borrower to sign personally for the loan. Fannie Mae offers non-recourse loans.
  • Lending in smaller markets. Many national lenders do not like to lend in rural or tertiary markets. Fannie Mae is a good option for these loans.
  • Assumability and Supplemental Financing. Fannie Mae allows their loans to be assumed by a qualified borrower. They also have a program which allows borrowers the ability to come back and borrow additional funds during the life of the loan (subordinate financing).

Texas Apartment Mortgages with Freddie Mac (FHLMC)

Freddie Mac is another government agency that provides mortgage capital in the secondary market for apartment building loans. Together, Fannie Mae and Freddie Mac control a very large portion of the multifamily market. Freddie Mac has a very aggressive program for small balance loans (from $1,000,000 to $7,500,000). Some features of this program include:

  • Market size driven. Freddie Mac classifies loans by the size of the overall market: Top, Standard, Small, and Very Small. Rates are best in top market locations (major metropolitan areas).
  • Capped costs. Freddie Mac lenders often cap the closing costs at a fixed dollar amount, thereby lowering the overall cost to borrow money.
  • Flexible pre-pay penalties. Freddie Mac offers many options for pre-payment penalties, from yield maintenance to step-down to “soft” step-down.
  • Interest-Only (I/O) loans. Freddie Mac will allow payments consisting of only interest and no amortization of principal.
  • Fixed rate terms. Freddie Mac offers fixed rates of 5, 7, and 10 years, followed by an adjustable period. These loans are called Hybrid/Adjustables. Loans have a 20 year term and a 30 year amortization schedule.

Texas Apartment Lending with Banks and Other Programs

While the agencies (Fannie Mae and Freddie Mac) offer some excellent programs, not every apartment loan applicant qualifies for these programs. We have many excellent choices for these loans with our correspondent banks, credit unions, insurance companies and private lenders. Some examples of these loans include:

  • Loans that require flexible underwriting or those that don’t meet standardized criteria.
  • Properties in less than desirable markets, or those that require repairs or updating.
  • Properties that don’t cash flow according to industry guidelines or lack stabilized cash flow.
  • Borrowers with past credit issues, including foreclosures, short sales, or judgements.
  • Borrowers who are not US citizens.

Whether you are purchasing or refinancing, we have the right solutions available for your multifamily mortgage loans. We will entertain loan requests of all sizes, beginning at $1,000,000. Click here to get started with a free loan quote.

Texas Multifamily Loan Information and Economic Overview

Texas has the second largest economy in the United States, trailing only California. It has a gross state product of over $1.6 trillion. If Texas were a sovereign country, it would be the 10th largest economy in the world by Gross Domestic Product.  Texas is home to 51 of the Fortune 500 companies. With a household income of $48,259 Texas ranks 25th in America. With a population of almost 30 million people and over 265,000 square miles of land, Texas is one of the three states contributing to over 40% of the U.S. and is larger in size than California and the entire country of France!

Commercial real estate in Texas is booming and investors should definitely look into receiving commercial mortgage financing here. The Texas investment property and multifamily industry supports approximately 380,000 jobs and contributes almost $60 billion to the state’s overall Gross State Product. When measured in terms of development, these numbers actually rate the Texas economy ahead of California! Texas’s large population, world famous educational institutions and thriving cities are all crucial factors that help create demand for commercial real estate investment in Texas. In terms of commercial mortgages, there are over 2.6 million mortgages for properties throughout the state of Texas. The average value of these commercial mortgages is over $5.4 million, 5% above the United States average. This data demonstrates that Texas is a great place to take out a commercial mortgage loan.

The Dallas-Forth Worth Metroplex is home to two of the fastest-growing cities not only in Texas but in the entire country. This metro area has been rated as the top investment property market in the U.S. With the inflow of new investors, Dallas has developed a much more diversified economy, a huge reason to invest in the Dallas Texas commercial real estate and multifamily market. In the multifamily and apartment space, rents have grown 3%. Additionally, in the second quarter of 2019 net absorption hit it the highest it’s been in 30 years. The delivery of multifamily and apartment buildings has exceeded the annual start, while single family developments are declining. Renters in Dallas Texas now have access to a wide range of property types. From low cost apartments to expensive condos, investors have readily available and accessible markets in the business.

Houston is another city in Texas to invest in commercial real estate. With a population of more than 2 million people, Houston is not only the largest city in Texas but is also one of top 5 most populated cities in the country. Houston has a thriving economy with tons of job growth. In commercial and industrial markets alone, job growth is projected at over 100 thousand jobs gained year-over-year. In the second quarter of this year rents in apartment buildings rose significantly and occupancy reached over 90%. Year to date absorption has reached over 10,000 new units, more than the entire amount absorbed last year. Additionally, there have been more apartment deliveries in 2019 than there were last year. Furthermore, rental rates for properties in Houston have continued to go up this year. Commercial real estate properties, specifically in the industrial sector have gone up over 1 percent. Retail and office spaces have seen increased rents as well. These numbers make now an amazing time to invest specifically in commercial real estate in Houston Texas.
Investing in the Texas market has provided investors great returns recently. Since 2010, the population has grown by 3.5 million translating into one and a half million new homes. Just under 2 million of those people came from elsewhere, attracted by better employment opportunity and by sensible home prices. Those attractions are still there – look at the rate of job growth in Dallas and Houston this past year, almost to 4%. That’s twice the national average making now as great a time as any to look into commercial mortgage financing in order to invest in Texas investment properties and multifamily buildings.

Texas Apartment Loans

Select Commercial provides apartment loans and multifamily loans throughout the state of Texas including but not limited to the areas below.

HoustonSan AntonioDallasAustinFort WorthEl PasoArlingtonCorpus ChristiBrownsvilleFriscoMcKinneyPlanoLaredoLubbockGarlandIrvingGrand PrarieAmarillo