Credit Evaluation School Instructor eBook - Oct 2023

People:

Kristina Tarik Beginning house flipper

Purpose:

Purchase property to fix up and rent Original loan amount; $1,000M Current loan amount: $900M

Payment:

Six months interest ‐ only, then monthly payment required, amortized over 15 years Payment derived from rental income DSCR: 1.45x Currently, 92 days past due

Protection:

First lien real estate mortgage on rental property Property appraised for $750M Unsecured and unlimited guaranty from Kristina

Problem:

Borrower did not properly complete renovations. Unoccupied for 6 months Not expected to receive any more payments as communication with borrower has ceased Bank in process of foreclosure; likely to take possession within next three months Once title is obtained, will work with realtor to sell the property “as is”

Prospects: