Financial metrics commonly used by loan underwriters (part 01)

By Victor Alarsa

If you are looking to get into Real Estate financier or just being more familiarised with its vocabulary, here you will find a few metrics commonly used by loan underwriters.

The daily life of a developer is not easy. They need lenders to help them to finance their developments, but lenders do not lend money without a thorough due diligence on the investment, starting with the covenants. Covenants imposes a limit on the amount of money a financier can lend to a development. In this article and the next, we are going to run through the most common covenant metrics used by loan underwriters.

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Do you know how to count the number of cells filtering several different criteria using Excel?

By Victor Alarsa

In essence, the COUNTIFS function is used to count the number of cells that meet one or multiple criteria, given a specific range of the array.

You may have noticed that COUNTIFS has an “S” in the end, which differs from its cousin COUNTIF, which is programmed to count the number of cells meeting only one condition and a single range, whereas COUNTIFS accepts several criteria.

The formula is comprised of ( criteria range 1, criteria 1 ), this is the required argument. In case you want to add new criteria, just add after the first two arguments

E.g. ( criteria range 1, criteria 1, criteria range 2, criteria 2).

You could add as many criteria as you want. The criteria range accounts for the array you want to count (highlighting them), and the criteria are the condition to be tested against those values.

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The benefits of SUMPRODUCT?

By Victor Alarsa

If you are one of those who loves to model using lots of “IF”, “AND” and “OR” functions, then this article is for you.

Let’s discuss the SUMPRODUCT, which literally means summing up the multiplication (product) of two or more different arrays.

For example, if you want to calculate total rental value of a property with different floor sizes and rents per square foot, then you simply need to multiply each floor size by its corresponding rent and sum up everything in the end.

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