David's 9-unit building had a weak debt service coverage ratio until Shafiq Hirani found $24,000 in hidden annual income: under-market rents, absorbed utilities, and an inflated vendor contract. Recapturing that income moved the building from borderline to comfortable without changing loan rates or market conditions.
Quick example. David owns a 9-unit building. His coverage ratio was borderline, and he assumed the problem was the rate environment. It was not. We found $24,000 of annual income he was leaving on the table, units below market, utility costs he was absorbing, and a vendor contract that had crept up over 3 years. That moved his coverage from borderline to comfortable. Same rate, same market, different building. Here's what I would do this week. 3 things. 1, call your lender or broker and ask 2 questions. What loan programs am I eligible for at my loan size? And what is my current debt service coverage ratio? If you don't know that second number, you don't know where you stand. 2, download my free NOI leak audit checklist. It walks you through the 5 places income slips out of an apartment building. Link in the description. If you are 6 to 24 months from a refinance or sale, book a free 15-minute NOI diagnostic with me. Let's find the income that moves your coverage ratio before you sit down with a lender. I'm Shafiq Hirani. This has been an Apartment Navigator Midweek Update. I'll see you Monday for the weekly briefing. Until then, keep navigating.
