2-4 Unit Loans

Financing a duplex, triplex or fourplex is different from financing a single-family home, and different again from an apartment building. Here is how it generally works.

Educational information only

2-4 Units is a real estate brokerage, not a lender. We do not publish interest rates, quote loan terms or guarantee approval. Programs and requirements change; confirm everything with a licensed loan originator.

Overview

Properties with one to four units are generally eligible for residential mortgage programs. That gives 2-4 unit buyers access to financing that typically isn't available for five or more units, which usually require commercial loans.

Conventional financing

Conventional loans are not government-insured and follow guidelines set by investors such as the agencies that purchase mortgages. Down payment, reserves and how rental income is counted depend on the number of units, occupancy and your credit profile.

Owner-occupied vs. investment

Living in one unit may open programs, including some government-insured options, that pure investors can't use, often with smaller down payments. Investment loans typically require more down and more reserves, and some qualify primarily on the property's income.

Loan programs

Programs to ask your lender about

Common program types used for 2-4 unit purchases. Availability and terms vary by lender.

Loan program summaries are being updated

Use the form below and we'll connect you with a licensed lender who works with 2-4 unit properties.

Payment estimator

Estimate a monthly payment

Enter the price, down payment and the rate from your lender's quote to estimate principal & interest and PITI.

Estimate, not a lender quote

Enter the interest rate quoted by your lender (e.g. 7.25).

Excludes mortgage insurance, HOA dues, utilities, and other costs. Actual payments, rates and eligibility are set by your lender; confirm every figure with a licensed loan originator.

Glossary

Loan terminology

Amortization: The schedule over which a loan is repaid through regular payments of principal and interest.
Loan-to-value (LTV): The loan amount divided by the property's value or price. A lower LTV means a larger down payment.
Debt-to-income (DTI): Your monthly debt payments divided by your gross monthly income, used by lenders to assess ability to repay.
Debt service coverage ratio (DSCR): The property's net operating income divided by its annual debt payments. Some loans qualify primarily on this ratio.
PITI: Principal, interest, taxes and insurance: the main components of a monthly housing payment.
Owner occupancy: Living in one of the units as your primary residence. It can affect which programs and terms are available.
Rental income credit: The portion of a property's current or projected rent a lender counts toward qualifying. Rules vary by program.
Reserves: Cash or liquid assets a lender requires you to have left after closing, often measured in months of payments.
Points: Upfront fees, each typically equal to 1% of the loan amount, that may be paid to reduce the interest rate.
Rate lock: A lender commitment to hold a quoted interest rate for a set period while the loan is processed.
Mortgage insurance: Insurance protecting the lender, often required when the down payment is below a program's threshold.
Impounds / escrow account: An account the lender uses to collect and pay property taxes and insurance along with your loan payment.

Request a lender introduction

Tell us about your purchase. We'll connect you with a licensed loan originator who works with 2-4 unit properties. We don't make credit decisions.

Nothing on this page is a loan offer, commitment, rate quote or financial advice. Estimates are for illustration only. Contact a licensed lender for terms, eligibility and disclosures.