Help! Real Estate Debt Technical Question! Upcoming interview.
Hi all, I have an upcoming RE debt interview. Why do lenders like high cash on cash returns? All help is appreciated in advance!
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Cash returns are dollars in the door in the current period that allow the borrower to service the debt. Banks/LifeCos care very little about the value reversion. They care that you can exceed your debt service so you can pay them interest.
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