Monitored Debt Service Coverage Ratio
When required per Part V, Chapter 5: Surveillance, Section 503.02: Quarterly Financial Analysis of Operations, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must determine the Monitored Debt Service Coverage RatioDebt Service Coverage RatioOn an annual basis or any specified period, the ratio of Net Cash Flow to the total of: principal, interest, and required Mezzanine Financing or Hard Pay Preferred Equity payments. on an aggregate basis for all Mortgage LoansMortgage LoansMortgage debt obligation evidenced, or when made will be evidenced, by the Loan Documents, or a mortgage debt obligation with a Fannie Mae credit enhancement. in the Collateral Pool, calculated as:
- the total for all PropertiesPropertiesMultifamily residential real estate securing the Mortgage Loan, including the
fee simple or Leasehold interest,
Improvements, and
personal property (per the Uniform Commercial Code).
of:
- trailing 3-month annualized net rental income; plus
- trailing 3-month annualized other allowable income, if any; minus
- trailing 12-month operating expenses; minus
- annual Replacement ReservesReplacement ReservesCustodial Account the Borrower funds during the Mortgage Loan term for Replacements. ;
- divided by the annual Actual Pay Debt Service Amounts for all Mortgage LoansMortgage LoansMortgage debt obligation evidenced, or when made will be evidenced, by the Loan Documents, or a mortgage debt obligation with a Fannie Mae credit enhancement. .