910.06

Net Worth and Liquid Assets

Requirements

You must ensure that:

  • the combined net worth of the Borrower BorrowerPerson who is the obligor per the Note. and all Key Principals Key PrincipalsPerson who controls and/or manages the Borrower or the Property, is critical to the successful operation and management of the Borrower and the Property, and/or may be required to provide a Guaranty. equals or exceeds the original principal amount of the Small Mortgage Loan Small Mortgage LoanMortgage Loan with an original loan amount less than or equal to $9 million. ; and
  • the combined post-closing liquid assets (excluding any Small Mortgage Loan Small Mortgage LoanMortgage Loan with an original loan amount less than or equal to $9 million. cash-out proceeds) of the Borrower BorrowerPerson who is the obligor per the Note. and all Key Principals Key PrincipalsPerson who controls and/or manages the Borrower or the Property, is critical to the successful operation and management of the Borrower and the Property, and/or may be required to provide a Guaranty. equal at least 9 monthly payments of P&I P&IPrincipal and interest on the Small Mortgage Loan Small Mortgage LoanMortgage Loan with an original loan amount less than or equal to $9 million. .

Guidance

You should:

  • for net worth, consider the impact of current, long-term, and contingent liabilities compared to the Small Mortgage Loan Small Mortgage LoanMortgage Loan with an original loan amount less than or equal to $9 million. amount; and
  • for liquidity, exclude the following unless you have reasonable justification:
    • retirement funds (such as IRAs and 401Ks); and
    • promissory notes payable to the Borrower BorrowerPerson who is the obligor per the Note. or a Key Principal Key PrincipalPerson who controls and/or manages the Borrower or the Property, is critical to the successful operation and management of the Borrower and the Property, and/or may be required to provide a Guaranty. , whether secured or unsecured.