An expense ratio measures how much you’ll pay over the course of a year to own a fund, and a high expense ratio can significantly impact your returns.
High Operating Expense Ratio→ If a property’s OER is higher, its ongoing operating expenses reduce a substantial percentage of its income. In effect, the margins on the property investment decline, which causes the returns to the real estate investor to decrease — all else being equal. The ...
Interest expense is the cost of borrowing money, whether for a business loan, mortgage, credit card, or bond. It represents the price paid to lenders in exchange for capital. The total interest expense depends on three factors: ...
Home office expenses enable self-employed business owners to claim a tax deduction from their annual tax returns for house expenses such as property taxes and mortgage interests. The house expenses can also include additional running costs ranging from an internet subscription to electricity bills. Mos...
The operating expense ratio (OER) compares the income a property brings in to the cost of running that property. This allows investors to see if a property would be a good investment, and how much return they can expect, as well as helping them compare to other potential property investments...
What Is the Interest Coverage Ratio? The interest coverage ratio measuresthe ability of a business to pay back its interest expense. It’s important to calculate this rate before taking out a loan of any sort to make sure the business can afford to repay its debt. ...
Expense Fees As to each Mortgage Loan, the sum of the Servicing Fee and the Trustee Fee. Expense Amount As defined in Section 11.01(b) hereof. management expense ratio means the ratio, expressed as a percentage, of the expenses of an investment fund to its average net asset value, calculat...
Debt-to-income ratio Debt-to-income is also another critical component of loan approval. When you are considered for a mortgage loan, a credit issuer will get the average amount of money you pay to creditors every month through your credit report. ...
The coinsurance clause will only be in effect at the event ofpropertyloss. During a loss, the insurance limit and the required amount to be used for insurance based on the coinsurance percentage are compared and must have a ratio equal to or greater than one, else, a penalty will be given...
Total Expense Ratio The ratio of total housing expense to borrower income. This ratio is used (along with other factors) in qualifying borrowers.SeeQualification/Meeting Income Requirements/Expense Ratios. The Mortgage Encyclopedia. Copyright © 2004 by Jack Guttentag. Used with permission of The Mc...