Polymeric nanocomposite thin films of magnetic nanoparticles blended with the ferroelectric polymer poly-(vinylidene fluoride-co-trifluoroethylene) (P(VDF-TrFE)) are promising candidates for multiferroic applications. To date, only thick-film multiferroic nanocomposites have been reported. Fabrication of nanocomposite thin films along with the study of the ferroic properties with magnetic nanoparticle loading is crucial for the realization of functional devices. However, systematic studies, and in particular the dynamic of ferroelectric polarization switching and a solid understanding of the microstructure formation in thin films, are still missing. Here, we present solution-processed P(VDF-TrFE):magnetic nanoparticle thin films for multiferroic applications, wherein the ferroic properties, polarization switching dynamic, and the microstructure formation are studied as a function of nanoparticle loading. Our results demonstrate that as the nanoparticle loading increases, the ferroelectric polarization of the nanocomposite decreases and the saturation magnetization increases. Moreover, the presence of the nanoparticles substantially increases the polarization switching time and shifts the switching mechanism to one-dimensional growth. The P(VDF-TrFE):magnetic nanoparticle solution phase separates upon film casting. The crystalline regions of P(VDF-TrFE) are pure. The amorphous regions accommodate the nanoparticles. The phase separation leads to agglomerated nanoparticles at higher loadings, and eventually stratified vertical phases occur. The insight gained from the study of thin-film microstructure would help to optimize the performance of the nanocomposite for multiferroic applications and can be used for better understanding of the polymer:nanoparticle nanocomposites for energy storage and memory applications.