Rental underwriting summary
$300,000 purchase · $2,500/mo rent
· prepared with RentCheck
Thin — lenders may balk
DSCR of 1.03 is below the 1.25 most commercial lenders want. It cash-flows $53/mo, but financing may be harder.
Purchase & financing
| Purchase price | $300,000 |
| Down payment | 20.0% ($60,000) |
| Interest rate | 7.0% / 30 yrs |
| Closing costs | 3.0% |
| Upfront rehab | $0 |
| Cash to close | $69,000 |
Income & operating
| Monthly rent | $2,500 |
| Taxes / yr | $3,600 |
| Insurance / yr | $1,200 |
| HOA / mo | $0 |
| Vacancy / maint / capex | 5.0% / 8.0% / 5.0% |
| Management | 0.0% |
Underwriting metrics
| Net operating income (yr) | $19,800 |
| Principal & interest (mo) | $1,597 |
| Cash flow (mo) | $53 |
| Cap rate | 6.6% |
| Cash-on-cash return | 0.93% |
| DSCR | 1.03 |
| Break-even rent (mo) | $2,435 |
| 1% rule | 0.83% |
| Gross rent multiplier | 10.0 |
10-year projection
| Year | Cash flow | Value | Loan |
Equity | Total profit |
|---|
| Year 1 | $639 | $309,000 | $237,562 | $71,438 | -$56,923 |
| Year 2 | $1,131 | $318,270 | $234,948 | $83,322 | -$43,907 |
| Year 3 | $1,633 | $327,818 | $232,145 | $95,673 | -$29,923 |
| Year 4 | $2,145 | $337,653 | $229,139 | $108,514 | -$14,938 |
| Year 5 | $2,667 | $347,782 | $225,916 | $121,866 | $1,082 |
| Year 6 | $3,200 | $358,216 | $222,460 | $135,756 | $18,171 |
| Year 7 | $3,743 | $368,962 | $218,754 | $150,208 | $36,367 |
| Year 8 | $4,297 | $380,031 | $214,780 | $165,251 | $55,706 |
| Year 9 | $4,862 | $391,432 | $210,519 | $180,913 | $76,231 |
| Year 10 | $5,439 | $403,175 | $205,950 | $197,225 | $97,981 |