A1 X fx fx INPUTS A B D E F G 1 INPUTS 2 HOLDING PERIOD 3 YEARS 3 UNITS 50 4 MARKET RENT (MONTHLY) PER UNIT $ 800 5 RENT INCREASE PER YEAR 1% 6 INITIAL PURCHASE PRICE $ 2,000,000 7 VACANCY LOSS 4% 8 CREDIT LOSS 1% 9 OPERATING EXPENSE RATIO 40% 10 CAPITAL EXPENDITURES 10% OF EGI 11 GOING OUT CAP RATE 10.00% 12 ORDINARY INCOME TAX 25.00% 13 CAPITAL GAINS TAX RATE 15.00% 14 DISCOUNT RATE 12.00% 15 16. 17 (Note: Compute the payment using both options to see which mortgage the subject property qualifies for. If it qualifies for both, choose the mortgage with the lowest EBC). 18 MORTGAGE OPTION 1: MORTGAGE OPTION 2: 19 ASSUME YOU BORROW AT MAXIMUM LIV, BUT YOU MUST MEET THE MIN DCR 20 MAX LTV 85% 80% 21 MIN Debt Coverage Ratio (DCR) 1.40 1.75 22 TERM (YEARS) 15 15 23 AMORTIZATION (YEARS) 30 15 24 INTEREST RATE 7.00% 6.50% 25 CLOSING COSTS: 26 ORIGINATION FEE (Lender) 1.00% 1.00% 27 OTHER NONLENDER FEES $ 2,500 $ 2,500 28 UNDERWRITING FEE (Lender) $ 300 $ 300 29 APPRAISAL $ 300 $ 300 30 SURVEY $ 500 $ 500 31 TOTAL CLOSING COSTS LENDER CLOSING COSTS 32 33 N PV PMT FV 34 35 MORTGAGE OPTION 1 EBC 36 37 PMT 38 OMB 39 EBC 40 41 Debt Coverage Ratio 42 Qualify for this mortgage? 43 44 MORTGAGE OPTION 2 EBC 45 PMT 47 OMB 48 EBC 49 50 Debt Coverage Ratio 51 Qualify for this mortgage? N PV PMT FV 46 A1 X fx fx INPUTS A B D E F G 1 INPUTS 2 HOLDING PERIOD 3 YEARS 3 UNITS 50 4 MARKET RENT (MONTHLY) PER UNIT $ 800 5 RENT INCREASE PER YEAR 1% 6 INITIAL PURCHASE PRICE $ 2,000,000 7 VACANCY LOSS 4% 8 CREDIT LOSS 1% 9 OPERATING EXPENSE RATIO 40% 10 CAPITAL EXPENDITURES 10% OF EGI 11 GOING OUT CAP RATE 10.00% 12 ORDINARY INCOME TAX 25.00% 13 CAPITAL GAINS TAX RATE 15.00% 14 DISCOUNT RATE 12.00% 15 16. 17 (Note: Compute the payment using both options to see which mortgage the subject property qualifies for. If it qualifies for both, choose the mortgage with the lowest EBC). 18 MORTGAGE OPTION 1: MORTGAGE OPTION 2: 19 ASSUME YOU BORROW AT MAXIMUM LIV, BUT YOU MUST MEET THE MIN DCR 20 MAX LTV 85% 80% 21 MIN Debt Coverage Ratio (DCR) 1.40 1.75 22 TERM (YEARS) 15 15 23 AMORTIZATION (YEARS) 30 15 24 INTEREST RATE 7.00% 6.50% 25 CLOSING COSTS: 26 ORIGINATION FEE (Lender) 1.00% 1.00% 27 OTHER NONLENDER FEES $ 2,500 $ 2,500 28 UNDERWRITING FEE (Lender) $ 300 $ 300 29 APPRAISAL $ 300 $ 300 30 SURVEY $ 500 $ 500 31 TOTAL CLOSING COSTS LENDER CLOSING COSTS 32 33 N PV PMT FV 34 35 MORTGAGE OPTION 1 EBC 36 37 PMT 38 OMB 39 EBC 40 41 Debt Coverage Ratio 42 Qualify for this mortgage? 43 44 MORTGAGE OPTION 2 EBC 45 PMT 47 OMB 48 EBC 49 50 Debt Coverage Ratio 51 Qualify for this mortgage? N PV PMT FV 46