(Answered) Question a property has an expected first-year noi of 1

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Question: A property has an expected first-year NOI of $1 million. Recent sales of similar properties indicate that a first-year (or going-in) cap rate of 9.75% is reasonable for valuation purposes. A lender requires a minimum DCR (or DSCR) of 1.25 and will loan up to 70% of appraised value on a first mortgage. If the mortgage interest rate is 6.75%, payments are monthly, and the amortization period is 20 years, what is the maximum-sized loan the lender will advance?

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