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Inkoom is analyzing an apartment investment with the following characteristics: Potential gross income ZAR1,000,000 - Vacancy allowance (1 00,000 ) Effective gross income 900,000 -
- Inkoom is analyzing an apartment investment with the following characteristics:
- Potential gross income ZAR1,000,000 - Vacancy allowance (100,000) Effective gross income 900,000 - Operating expenses 300,000 Net operating income ZAR600,000
- The preliminary estimate of value for this property is ZAR7 million.
- Edwards Mortgage is willing to provide a 5-year balloon loan at 7.25 percent on a 20-year amortization schedule with monthly payments. The minimum debt-coverage ratio (DCR) is 1.25 and the maximum loan-to-value (LTV) ratio is 75 percent.
Based on Inkoom's preliminary forecast and his lender's underwriting criteria, what is the maximum loan amount Inkoom can expect?
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Spreadsheet Modeling And Decision Analysis A Practical Introduction To Business Analytics
Authors: Cliff Ragsdale
7th Edition
1285418689, 978-1285969701, 1285969707, 978-1285418681
