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COMMERCIALBANC
REAL ESTATE CAPITAL
MARKETS
APARTMENT FINANCING GROUP
APARTMENT LOAN
UNDERWRITING GUIDELINES
THE EASIEST WAY TO FIND SPECIFIC
ITEMS IS THROUGH THE TABLE OF CONTENTS
TABLE OF CONTENTS
APARTMENT LENDING PREAMBLE
INTRODUCTION
SECTION 1 (PROPERTY)
SECTION 2 (BORROWER)
SECTION 3 (PARAMETERS)
EXHIBITS
PLEASE KEEP IN MIND THAT EVERY
EFFORT HAS BEEN MADE TO ENSURE ACCURATE AND CURRENT INFORMATION.
AS SUCH, COMMERCIALBANC RESERVES THE RIGHT TO
CHANGE, ALTER, AND ELIMINATE ANY INFORMATION WITH OR WITHOUT
PRIOR WRITTEN NOTICE.
COMMERCIALBANC -
REAL ESTATE CAPITAL MARKETS
MULTIFAMILY FINANCE GROUP
APARTMENT LOAN UNDERWRITING TABLE OF CONTENTS
PREAMBLE
INTRODUCTION
SECTION I- PROPERTY
LOCATION OF PROPERTY
APARTMENT LENDING
MARKETS
ELIGIBLE PROPERTY
TYPES
INELIGIBLE PROPERTY
TYPES
PROPERTY CONDITION
ASSESSMENT
REPAIRS AND
MODERNIZATIONS
Repair/Modernization
Holdback Agreements
Repair/Modernization
Letter Agreements
Advisory
Repair/Modernization Letters
Seller Contributions
For Repairs
Repair/Modernization
Holdback Agreements/Letter Agreements For Low LTVs
ENVIRONMENTAL HAZARD
GUIDELINES
Common Environmental
Hazards
Definition Of
Environmental Site Assessments
Transaction Screen
Questionnaires
Phase I ESAs/Phase II
ESAs
Limited Phase I ESAs
Use Of An Approved
Environmental Assessment Firm
Reviewing The Limited
Phase I ESA By AAAL
Criteria For Loan
Denial
PROPERTY AND
LIABILITY INSURANCE REQUIREMENTS
Property Insurance
General Liability
Insurance
Other Insurance
Requirements
SECTION II- BORROWER(S)
ELIGIBLE BORROWERS
FOR MULTI-SERIES APARTMENT LOAN PROGRAM
Borrower’s Age
Citizen, Resident &
Immigration Status
Guarantors,
Co-Signers And Non-Purchasing Spouses
Title Entity and
Guaranty Requirements
Layered Entities
Corporations
Limited Liability
Companies (LLCs)
General Partnerships
Limited Partnerships
Limited Liability
Partnerships (LLPs)
Living Trusts
Realty Trusts
(Massachusetts only)
Land Trusts
Property Management
Experience/Management Letters
Multiple Mortgages To
The Same Borrower
DOWNPAYMENT/ RESERVE
REQUIREMENTS
Qualifying Assets
Reserve Requirement
Impounds
PAYMENT OF SETTLEMENT
COSTS
Contributions By
Non-Participants
Excessive
Contributions
INCOME AND CREDIT
ANALYSIS
Credit Report
Reviewing The Credit
Report
Borrower(s) Without
Established Credit
Credit Scoring
SECTION III- APARTMENT
FINANCING PARAMETERS
ELIGIBLE
APARTMENT MORTGAGES
Apartment Loan Purchases
Apartment Loan Refinances
Apartment Loan No Cash-Out Refinance
Apartment Loan Cash-Out Refinances
Minimum/Maximum
Apartment Mortgage Amount Limits
PROPERTY ANALYSIS
Remaining Economic
Life/Amortization Periods
Debt Coverage Ratio
(DCR) And Combined Debt Coverage Ratio (CDCR)
Apartment Loan Purchases
Apartment Loan No Cash-out
Refinances
Apartment Loan Cash-out Refinances
Current Cash-Flow
Analysis
Historical Cash-Flow
Analysis- Purchases
Historical Cash-Flow
Analysis- Refinances
Rent Stabilization
Holdback
Extraordinary
Appreciation
APARTMENT FINANCING LOAN-TO-VALUE RATIOS
Apartment Loan Purchases
Apartment Loan Refinances
Unseasoned
Seasoned
SUBORDINATE
APARTMENT FINANCING
Apartment Loan Repayment Terms
Ineligible Types Of
Subordinate Financing
RECOURSE REQUIREMENTS
REQUIRED
APARTMENT LOAN
DOCUMENTATION
EXHIBITS-
CLIENT
DETAILED UNDERWRITING SUBMISSION CHECKLIST
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