Office – Loan Underwriting Guidelines
Please incorporate the below minimum guidelines when you prepare and submit your proforma for underwriting approval:
| Rental Income: | Based upon current rent roll annualized with vacant space calculated at market rents | |
|---|---|---|
| (+) | Other Income: | Must be supported by historical collections |
| (-) | Vacancy: | Equal to the greater of the actual vacancy plus 1% credit loss, market vacancy plus 1% credit loss or 10% |
| (-) | Management: | Equal to the greater of the actual management fee of 5% |
| (-) | Operating Expenses: | Should be supported by previous two (2) years and current year-to-date expenses |
| (-) | Capital Reserves: | Typically $.20 per square foot minimum, depending upon property age and condition |
| (-) | Leasing and Tenant Improvement Reserves: | Reserves subject to market rates applied to rollover tenants, commissions and tenant improvements. Additional reserve deposits may be required based on anticipated rollover costs. |
| Equals: | Net operating income |