Page 138 - Trump University Commercial Real Estate 101

TRUMP UNIVERSITY COMMERCIAL REAL ESTATE 101

• How much they pay
• Utilities charges
• Security deposit
• Amount they owe

When comparing the rent roll with the rental income line on the
operating statement for any given month, the two numbers should be
equal. If they are not, something is going on with the numbers.

Past Three Months of Bank Deposits

The operating statement numbers might look good, but you should
verify that they are real. The past three months of bank deposits will

show you what ’ s flowing into the property account.
If they cannot show the corresponding amount of money going
into the account, they probably are not collecting that money. Some
sellers handle this objection by saying they are collecting cash and not
putting it into the account.
Now that ’ s kind of odd. It ’ s possible that the seller is collecting
cash, but you need to understand why. It ’ s another red flag. If it ’ s not a

lot of money and you still want to proceed with the deal, then you want
verification: Ask the seller to begin to put all future money into the

account so you can verify the cash flow between now and the closing.

The deeper you look into the deal, what are you fi nding: more
answers, or more questions? If it ’ s the former, then things are going
well. If this deal is becoming a bigger puzzle by the day, you should be
worried.

Existing Loan Documents

Get a copy of all existing loan documents to see if there ’ s any way to
make this deal a little better for yourself. Perhaps the bank allows the
existing loan to be assumed by a new owner. That could lower your
closing costs. Again, your mortgage broker can very quickly point out
any opportunities in the existing fi nancing.

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