Debt service is simply the mortgage payment associated with a property. This can be annualized by multiplying one payment by 12.
If you are considering purchasing a property that has a NOI of $60,000. To better understand what your cash flow will look at, you will want to subtract your debt service from the NOI.
Example Property 1
Monthly Mortgage Payment: ($896
Debt Service - $10,752
Cash Flow $49,248
This is a continuation of a serious entitled: The Top 10 Terms of Commercial/Investment Real Estate.
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