You are a Loan Officer with an Investment Bank. Today you need to set your lending parameters. They are:

DSCR: 1.25

LTV: 65%

10 Year T-Bill: .447

Rate Markup: 325 Basis Points

Term: 25 Years

Amortization: 25 Years

A small investment company is buying an investment property. The terms are:

Cash Flow: $107,000

Cap Rate: 6.02%

1. What is the price?
2. What is the annual debt payment?
3. What is the mortgage constant?
4. Does the debt create positive or negative financing?
5. As a lending officer, would you do this loan? Why?