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Underwriter told me my NOI projections were way too rosy
Ngl, I had a deal on a small strip plaza near Portland that I was sure would pencil out at a 1.25 DSCR. The underwriter came back and said my vacancy rate at 5% was a pipe dream for that area and bumped it to 12% based on 3 years of local data. I was pissed at first but then I ran the numbers again and realized I was basically ignoring the actual market comps. Has anyone else had a lender call them out on something that totally changed how you underwrite your next deal?
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robertb304d ago
Had a lender once flag my parking ratio as too low on a hardware store deal and I laughed until I saw the traffic study they pulled.
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Oh man, I've been there. A lender once flagged my expense ratio on a duplex and I was so defensive until I looked at their data and realized I had completely overlooked how much repairs were running in that zip code. It stung but it honestly saved me from a deal that would have bled cash month to month. Sometimes those hard calls from the underwriter end up being the best reality check you can get.
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