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Hard money lenders fund multifamily properties — but the programs, underwriting, and lender pool are different from single-family residential. Small multifamily (2-4 units) is more accessible and more widely funded. Larger multifamily (5+ units) enters commercial territory with a different set of lenders, underwriting standards, and loan structures.
2-4 unit properties — duplexes, triplexes, and fourplexes — are classified as residential by most lenders and underwritten similarly to single-family hard money loans.
What is the same:
What is different:
Common use case: A value-add investor acquires an underperforming 4-plex, renovates vacant units, raises rents, then refinances into a DSCR loan once stabilized. Hard money funds the acquisition and renovation; the DSCR loan is the exit.
5+ unit properties are classified as commercial, which changes the underwriting framework and the lender pool significantly.
Key differences from residential hard money:
Income-based underwriting: Commercial lenders underwrite heavily on the property's income — current NOI (net operating income), stabilized NOI, cap rate, and projected DSCR. The borrower's experience and financials still matter, but the income story drives the deal.
Loan sizing: Commercial bridge loans on multifamily are often sized based on a multiple of stabilized NOI or projected DSCR, not just a percentage of property value.
Lender pool: Residential hard money lenders typically do not fund 5+ unit properties. You need commercial bridge lenders — a distinct category of lenders who specialize in transitional commercial real estate.
Recourse: Commercial bridge loans are more commonly recourse or partial recourse than residential hard money. Personal guarantees are more common.
Timeline and process: Commercial underwriting takes longer and is more document-intensive. Appraisals, rent rolls, operating statements, and environmental reviews are standard requirements.
The most common reason investors use hard money or commercial bridge for multifamily is a value-add acquisition — buying an underperforming property and improving it to stabilized occupancy and market rents.
The deal lifecycle:
The bridge loan funds the gap between "current distressed condition" and "stabilized and refinanceable."
As-is value vs. stabilized value: The lender needs to understand both the current value (what secures the loan if things go wrong today) and the stabilized value (what the exit refinance will be based on).
Renovation plan and budget: How are you getting from distressed to stabilized? What specifically are you renovating, what does it cost, and on what timeline?
Current rent roll: Who is in place, at what rents, on what leases? Occupied units provide income. Below-market or month-to-month tenants represent upside that needs to be underwritten carefully.
Market rents: What do comparable stabilized properties rent for? The stabilized NOI is calculated from market rents — and the exit refinance depends on it.
Exit strategy: What is the refinance path, with whom, and at what terms? Has the borrower spoken with a permanent lender about the refinance they are projecting?
Borrower experience: Multifamily value-add requires specific skills — project management, property management, lease-up. Lenders want to see evidence the borrower can execute.
The biggest mistake in multifamily hard money is submitting to a single-family residential lender and being confused when they decline. The programs are genuinely different.
For 2-4 unit deals: look for residential hard money lenders who explicitly state they fund small multifamily.
For 5+ unit deals: you need a commercial bridge lender. Broker Cheetah's lender matching filters by property type — including small and large multifamily — so you reach the right lender for your specific deal size and structure.
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