Assume a property with NOI of $2,000,000. Comparable properties are selling at cap rates of 6.25%. The
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Assume a property with NOI of $2,000,000. Comparable properties are selling at cap rates of 6.25%. The bank will lend up to 75% of value. Assuming you obtain the loan, the terms are 4.75%, monthly pay, 25-year amortization.
a. What is the amount of the loan the lender will commit? b. What is the Debt Service Coverage? c. What is the Debt Yield?
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