Posted by Fred on January 16, 2000 at 11:27:47:
JPiper,
Thanks for responding. A DSCR is “Debt Service Coverage Ratio.” DSCR is calculated by taking Net Operating Income(NOI) divided by Annual Debt Service(ADS). For example: a property has a NOI=$10000 and an ADS=$7200, has a DSCR of 1.39. This means it generates enough income to coverage yearly mortgage payments. I hope this clears up any confusion.
Lease w/Option to purchase is having problems - Posted by Fred
Posted by Fred on January 15, 2000 at 23:10:10:
I’ve entered into an lease w/option to purchase. I would value some greatly needed input. First, there are five properties involved. I have them with no money down and a 2% option fee that will be waived upon successful financing within 60 days. Second, the properties have a dscr of 1.61, and are section 8 qualified. I’ve exercised my option to purchase the properties and we haven’t recorded anything. I would like some advice on how to keep myself protected in this deal and to keep any problems from affecting the deal so that I could use the properties to obtain financing.
Thanks,
Fred
Enlighten Me… - Posted by JPiper
Posted by JPiper on January 16, 2000 at 07:54:25:
What is a “dscr of 1.61”? Never heard of it.
JPiper
Re: Lease w/Option to purchase is having problems - Posted by chris
Posted by chris on January 16, 2000 at 01:32:17:
You should at least record a memorandum of agreement. This will show that a transaction is proceeding without revealing the details.
-Chris