Tagged: construction interest
- October 23, 2017 at 7:19 pm #422
How is construction interest calculated?
- October 23, 2017 at 7:20 pm #423
The construction interest is modeled on the Dev-Interest Calc tab (show that tab by setting F43 on the Summary tab to ‘Show’). Interest is calculated as the Construction Interest Rate (Sources and Uses C15) divided by 12 (to arrive at a monthly interest rate) times the construction loan balance in each month (row 21) plus any accrued interest. This calculation is a circular reference, hence the ‘Set Construction Loan Amount’ macro on the Sources and Uses tab which iterates the calculation to arrive at an interest reserve and total construction loan amount.
- March 21, 2019 at 6:42 pm #777
Follow up question: How do I reduce the interest reserve number by the amount of available operating cash flow that could be used to pay it before full stabilization and a take-out loan is arranged? This causes the interest reserve to be too high. Am i missing something?
PS: I realize I’m posting this question on a couple of threads. Sorry for any inconvenience.
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