Trending Content - Real Estate Forum
| +43 | What should we be buying? | 28 | 23h |
| +31 | Uncertain of what To Do Next | 5 | 4d |
| +31 | Where are free agents signing? | 9 | 3h |
| +28 | Capital Restricted Developer | 2 | 4d |
| +28 | Laughable Job Posting | 5 | 22h |
| +23 | Warning: J. Shaw Recruiters | 5 | 4d |
| +8 | Development Budget: use RENTABLE or GROSS BUILDABLE sf? | 3 | 1d |
| +6 | First-year REPE analyst comp check (London) | 1 | 5d |
| +4 | Vandy MSF or NYU MSRE | 4 | 4d |
| +4 | Shops with largest intern classes | 5 | 3d |
Career Resources
Bump - distressed/NPL valuation "best practices" would also be nice to hear
I'd be curious to know this as well
To mark to market a loan, you take the NPV on the stream of payments of the loan, discounted by the current market rate. And then subtract the UPB from the NPV value.
Example $10MM loan, 10 year at 5.0%. Market rate is 7.50%. NVP of the 5% loan payments at 7.5% is $8,373,745.59. Loss to Market = 8,373.745.59 - 10,000,000 = ($1,626,254.41).
Once you sell, you have to add in broker/marketing fees, third party fees and legal bills which will reduce your price even more.
On distressed, you do the same thing except your rate will be much higher to account for whatever issue is happening at the property.
Thank you, mrcheese. What's the best source for market rates?
There isn't a definitive source for market rates. You have to price the loans individually based on the metrics of the loan.
How do you have experience doing this? LifeCo buying the A-piece of debt fund loans? Or working in distressed debt acquisitions
Aut delectus nulla qui sit. Doloremque consectetur hic inventore aspernatur sit consectetur dolorum magnam. Voluptatibus neque tempora atque necessitatibus.
Tempore necessitatibus labore et modi quia quis est. Aut voluptatibus et molestiae nobis dolores explicabo. Nemo voluptatem aut sit.
Et labore tempore tenetur ut quaerat. Sit beatae aliquid reiciendis rerum debitis nihil et. Id architecto quo aut. Ut facere ducimus impedit quidem vel qui. Inventore possimus nesciunt pariatur eveniet.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...