Question: Consider a 5.5% loan amortizing at a 20-year rate with monthly payments. What is the maximum amount that can be loaned on a property whose

Consider a 5.5% loan amortizing at a 20-year rate with monthly payments. What is the maximum amount that can be loaned on a property whose net operating income (NOI) is $1,000,000 per year, if the underwriting criteria specify a debt service coverage ratio (DCR) of not less than 130% and a maximum loan-to-value (LTV) ratio of 80%? The property value is estimated by direct capitalization using a rate of 8% on the stated NOI.

	$9,318,760
	$9,314,236
	$10,000,000
	$13,412,500

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