For Questions 2 and 3: An office property was sold/bought for $435,000, while it was appraised at $425,000. The NOI in year one is projected to be $31,370. The bank is willing to lend up to 75% LTV. Regardless of the LTV, the borrower decides to borrow $295,000 at an interest rate of 7% on a 25 year term.

2. The maximum loan amount per the underwriting guidelines is $318,750 True/False

3. The DSCR on the actual loan the borrower took out is 1.3 (Note: loan amount is $295000) True/False

Provide Supportive evidence Why true or False