The capitalization rate, or cap rate, is used to compare an income property with other properties that are similar to the subject.  It can also be used to value a property based on the income it generates.
The cap rate explained simply is the projected return for one year if the property was purchased with no […]

Posted in Broker Resources, Commercial Lending, Terms & Definitions No Comments »

In commercial lending, it is important to understand and know how to evaluate the income of a commercial property.  Today I am going to go over some basics on evaluating income on a commercial property.
There are two basic foundations for evaluating a commercial properties income.  You have contract rent and market rent.  Contract rent is […]

Posted in Broker Resources, Commercial Lending, Terms & Definitions 2 Comments »

 
Yesterday I talked about the two major mortgage insurers and their tighter mortgage insurance requirements.  The new requirements could spell an end to much, if not all, of the 100% financing that is currently available.  Today I’m going to talk about mortgage insurance in general, and when it is required.
Mortgage insurance is typically required on […]

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Why can’t I qualify for a loan?  I get this question from borrowers a lot these days, with the tighter lending standards and the demise of no doc loans.  In addition to credit factors and loan to value issues, one of the major issues today is the DTI ratio.  I believe it is important for […]

Posted in Borrower Resources, Terms & Definitions No Comments »