Lenders use the organizational chart to secure the transaction's legal name, type of entity (not-for-profit corporation, corporation, general partnership, limited partnership, limited liability corporation, etc.), and identity of the key principals, including managing members.
When filling out the chart, it is important to identify the ownership percentages of general and limited partners. The information will be used to verify the key principals who have signing authority for this transaction and the relationships between or among the participating entities.
Each key principal in this transaction must fill out a personal financial statement, which provides a snapshot of their current net worth and liquidity.
The lender will use this document to determine the ability of the key principals/organization to afford the transaction, and any potential default risk.
The Rent Roll Template is utilized by the lender to confirm occupancy percentages and unit types provided by the borrower. The length of the leases as well as the move-in dates reflect the number of long-term leases and identifies high tenant turnover. If there are a large number of concessions, it may serve as a red flag for lenders.
Borrowers can determine their estimated principal and interest payments by inputting their loan amount, interest rate, and loan term. It also amortizes the amount that is applied toward the principal for the first 30 years of the term.
The Schedule of Real Estate Owned Template informs the lender the borrower's multifamily ownership and experience by stating the type of properties that are owned, the equity, debt service coverage, and ownership percentage owned. This information reflects financial strength of the borrower as well as provide a snapshot of maturing loans and if the borrower has sufficient equity to refinance balloon payments that are due.
Borrowers can input their existing loan to determine the payoff penalty amount that would be charged prior to the maturity date.