Updated almost 6 years ago on . Most recent reply
Loan Underwriting Requirements
Hi everyone!
I am reading Doug Marshall's "Mastering the Art of Commercial Real Estate" since I am learning about real estate investment. I am wondering about lenders typically wanting a borrower's net worth to be equal to or greater than the loan amount, have a DCR in excess of 1.25 to 1, a Global Leverage no more than 75%, and such. Are these hard and fast rules for lenders? How does a new investor go about meeting requirements like these? Also, it sounds like having a partner or two would be a good idea for many reasons. I have changed my schedule to dedicate the time I am not at work to educating myself on CRE investing.
Thank you for the help!
I am reading Doug Marshall's "Mastering the Art of Commercial Real Estate" since I am learning about real estate investment. I am wondering about lenders typically wanting a borrower's net worth to be equal to or greater than the loan amount, have a DCR in excess of 1.25 to 1, a Global Leverage no more than 75%, and such. Are these hard and fast rules for lenders? How does a new investor go about meeting requirements like these? Also, it sounds like having a partner or two would be a good idea for many reasons. I have changed my schedule to dedicate the time I am not at work to educating myself on CRE investing.
Thank you for the help!