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COMMERCIAL GUIDELINES- NO DOC
Eligible Property Types
Occupancy Types:
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Investment Property Commercial - Mixed Use w/Residential
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Commercial - Mixed Use w/o Residential
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Commercial - Retail Commercial – Light Industrial
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Commercial - Multi-Family > 4 Units
Property Types
Commercial - Retail Commercial - Light Industrial
Commercial- Multi-Family > 4 Units
Commercial- Office Commercial- Condo
NOTE: To be considered residential mixed use, 50% of revenue must come from apartments (residential).
NOTE: Exceptions to property type are considered on a case by case basis.
Property Value Determination & Seasoning
PURCHASE: Use lesser of purchase price or current appraised value.
REFINANCE: Use current appraised value if property has been owned for 12 months or more.
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If property has been owned for less than 12 months, then use the lesser of current appraised value or purchase price.
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Exceptions to the 12 month rule will be considered provided property improvements or rental increases can be documented.
Owner Occupied and Single Tenant Transactions > $2,000,000
Appraisal Requirements
Lender requires one full appraisal which is paid for in full, COD, by borrower. Appraisal is ordered and reviewed by lender. The property value is based upon the Income Approach.
General Underwriting Parameters
Documentation Requirements
NO DOC: This documentation level does not require disclosure of income, employment or assets.
LOW DOC: Borrower to supply the following:
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Financial statement on borrowers with a majority ownership interest.
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Real Estate Schedule of investment properties (address, current value, balance, date acquired, purchase price and when acquired).
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Two months bank statements demonstrating liquidity & seasoned cash to close. If required, seasoned after close reserves as well.
Loan Amounts & Loan to Values
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Multi-family & Mixed-use residential- NO DOC: $2.5 Million.
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Multi-family & Mixed-use residential- LOW DOC: $5 Million.
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Strict commercial & mixed-use commercial: $2 Million.
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NOTE: Mixed use residential requires >= 50% of income derived from apartments (residential).
PURCHASE: 80% LTV / 90% CLTV
REFINANCE: 75%LTV
Credit Requirements
A. Minimum Credit score is 620
B. On loans with multiple borrowers:
- Use the qualifying score of the majority owner.
- If ownership is equal, use the highest qualifying score.
C. The following derogatory credit items are subject to individual evaluation, regardless of credit score:
Cash Reserves
NO DOC: Cash reserves need not be disclosed.
LOW DOC: Must have liquid assets of at least 12 months PITI. Assets may be pooled however; they must come from the borrower with majority ownership interest in the property.
Number Of Properties Owned
NO DOC: No restriction.
LOW DOC: Real estate schedule must show at least one investment property owned for at least 2 years.
Property Tax/Insurance Impounds
Required. May be waived when < = 70% LTV.
Environmental Insurance
A search will be done on the property and the results will determine whether or not an environmental would be required.
Non-Natural Entities
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Corporation, Trusts, Partnerships are allowed, however credit scores will be based on the individual determined to be the primary borrower.
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The primary borrower is defined as the individual holding majority ownership.
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In cases where several individuals hold equal majority ownership positions, credit scores will be based on all of these individuals.
Lease Guidelines
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All leases required for review and analysis except on Apartments where a Certified Rent Roll along with 2 years previous income can be substituted.
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Lease will be require on apartment with rents in excess of $1,500 per month when the loan amount exceeds $1,000,000. Under $1,000,000 they are not required.
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Controlled, stabilized and other registered rents must be reviewed and analyzed when applicable.
Debt Service Coverage Ratio Guidelines (DSCR)
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For multi-family and mixed use residential properties, DSCR (Debt Service Coverage Ratio) should not be less than 1.2 regardless of the loan amount.
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For commercial and mixed-use commercial properties, DSCR (NOI/PI) should not be less than 1.2 for loans <= $1,000,000 and 1.3 for loans exceeding $1,000,000.
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NOTE: The following will need to be figured into the DSCR so please make sure you provide this for me:
Basic Sequence of Actions
- Provide me the property information (normally the listing agent will have all this
 information in a package:
- Property address & purchase price
- Real Estate Taxes
- Insurance
- Water & Sewer
- Utilities
- Any other applicable expenses
- # of units
- Sq footage of each unit
- Rent for each unit
- # of unit occupied
- Listing agent's or seller's (if no agent) contact information
- I will put all the numbers together and if they work I will submit for an initial underwrite.
- Underwriting will come back with terms and conditions, Letter of Intent (LOI)
- We will order the appraisal- COD.
- Search for environmental will be done.
- I will gather leases and needed information.
- Everything will go into underwriting for final underwrite.
- Close the loan.
The following counties are eligible for the 90% No Doc Commercial Program:
1. Arizona: Maricopa, Pima and Pinal counties
2. California: All counties
3. Colorado: Adams, Arapahoe, Boulder, Denver, Douglas, El Paso, Jefferson, and Larimer counties
4. Connecticut: Fairfield, Hartford and New Haven counties
5. Delaware: New Castle county
6. Florida: Brevard, Broward, Charlotte, Collier, Duval, Hillsborough, Indian River, Lee, Manatee, Martin, Miami-Dade, Nassau, Orange, Palm Beach, Pasco, Pinellas, Polk, Sarasota, Seminole, St. Johns and St. Lucie counties
7. Georgia: Clayton, Cobb, DeKalb, Douglas, Fayette, Forsyth, Fulton, Gwinnett and Cherokee counties
8. Idaho: Ada county
9. Illinois: Cook, Kane, DuPage, Lake, McHenry and Will counties
10. Indiana: Hamilton, Indianapolis and Marion counties
11. Kansas: Wyandotte and Johnson counties
12. Kentucky: Fayette, Franklin, Jefferson and Kenton counties
13. Maryland: Anne Arundel, Baltimore (aka: Baltimore City), Howard, Montgomery and Prince George's counties
14. Massachusetts: Bristol, Essex, Middlesex, Norfolk, Plymouth, Suffolk and Worcester counties
15. Minnesota: Anoka, Carver, Dakota, Hennepin, Ramsey and Wright counties
16. Missouri: Clay, Jackson, Platte, St. Charles and St. Louis counties
17. Nevada: Carson City, Clark and Washoe counties
18. New Hampshire: Cheshire, Hillsborough, Rockingham and Merrimack counties
19. New Jersey: All counties
20. New Mexico: Bernalillo and Santa Fe counties
21. New York: Albany, Rensselaer, Bronx, Dutchess, Kings, Nassau, New York, Orange, Queens, Richmond, Rockland, Suffolk and Westchester counties
22. North Carolina: Cabarrus, Catawba, Davidson, Durham, Forsyth, Gaston, Guilford, Johnston, Lincoln, Iredell, Mecklenburg, Orange, Union and Wake counties
23. Ohio: Cuyahoga, Franklin, Hamilton, Montgomery, Lucas, Summit and Delaware counties
24. Oregon: Clackamas, Deschutes, Marion, Multnomah, Washington and Yamhill counties
25. Pennsylvania: Allegheny, Bucks, Butler, Chester, Delaware, Montgomery, Philadelphia, Washington and Westmoreland counties
26. Rhode Island: Bristol, Kent, Newport, Providence and Kenton counties
27. South Carolina: Anderson, Berkeley, Charleston, Dorchester, Greenville, Lancaster, Lexington, Richland, Spartanburg and York counties
28. Tennessee: Davidson and Shelby counties
29. Texas: Bastrop, Bexar, Blanco, Brazoria, Caldwell, Collin, Coryell, Dallas, Denton, Fort Bend, Galveston, Guadalupe, Harris, Hays, Kendall, Montgomery, Rockwall and Tarrant, Travis and Wilson counties
30. Utah: Salt Lake, Utah counties
31. Virginia: Arlington, Chesterfield, Fairfax, Hanover, Henrico, James City, Loudoun, Prince William, Surry and York counties; Chesapeake, City of Alexandria, Falls Church, Fairfax, Fredericksburg, Hampton, Manassas, Manassas Park, Newport News, Norfolk, Poquoson, Portsmouth, Richmond, Suffolk, Virginia Beach and Williamsburg cities
32. Washington: Clark, King, Kitsap, Pierce, Snohomish and Thurston counties
33. Washington, D.C
34. Wisconsin: Milwaukee and Dane counties
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