Residential rental property with five or more units. Banks, credit unions and HMDA all draw the line between four units and five.
Regulation C defines a multifamily dwelling as one that contains five or more individual dwelling units, whatever the construction method. The OCC handbook draws the same line from the other side: a 1-4 family residential property has fewer than five units. That boundary decides which desk at a lender handles a loan, which call report line the balance lands on, and how the loan is reported under HMDA.
For a borrower, the line changes the underwriting. A building of five or more units is judged mainly on the property’s income. The OCC handbook notes that apartment leases typically run one year, that operating expenses usually fall between 35 and 45 percent of revenue, and that amortization on a stabilized multifamily loan can run up to 30 years. A lender will ask for the rent roll and operating statements, then compare rent roll occupancy with rent collected.
A duplex, triplex or fourplex is not multifamily in this sense, even when it is a pure rental.
How it shows up in the data here
Two sources. Call reports give the multifamily balance each bank held on its report date, and HMDA gives the loans each lender made on buildings of five or more units in 2025 and 2024, with count, dollars, median size and rate. See multifamily lenders, the ranking by dollars made and loan comps.
Go further
- Multifamily lenders: Banks, credit unions and other lenders with multifamily loans on the public record.
- Largest multifamily books: Banks ranked by multifamily balance held.
- DSCR calculator: Cash flow over debt service. Type the cash flow and the loan terms, see the ratio and the cushion before it falls to 1.00x.
- Maximum loan calculator: The loan each test allows: DSCR, LTV and debt yield side by side, and which one binds.
- Multifamily loan checklist for 5+ unit properties: A larger apartment loan can go to five kinds of lender. They want much the same package. They differ on recourse, term, prepayment, speed and what they ask of the sponsor.
- How to read HMDA data for multifamily and investor loans: HMDA is the one public file that lists individual apartment and rental-house loans by lender, amount, county and year. It covers loans on dwellings only, and not every lender reports.
Related terms
- Small-balance multifamily: A loan on an apartment building of five or more units that falls under a size cap. Each program sets its own cap, so the phrase has no single legal meaning.
- Investor 1-4 unit property: A house, duplex, triplex or fourplex held as a rental or for resale, not lived in by the borrower. It has fewer than five units, so it is not multifamily.
- Home Mortgage Disclosure Act (HMDA): The federal law that makes mortgage lenders collect and publish loan-level data on loans secured by a dwelling, including apartment buildings and 1-4 unit rentals.
- Rent roll: A list of every unit or space in a property showing the tenant, the rent, the lease dates and what is vacant, as of a stated date.
- Agency lender: A lender authorized to make apartment loans that Fannie Mae or Freddie Mac then buys or backs, under those companies' rules instead of the lender's own.
Sources
Plain definitions for orientation, not legal, tax or credit advice. A lender's own policy decides what it will do.