Multifamily Real Estate Financing Glossary
Learn the lingo of commercial and multifamily finance with our easy-to-read and comprehensive glossary of terms.
Debt yield is a commercial real estate metric used by lenders to determine how long it would take them to get back their investment if the borrower defaulted on their loan and they had to foreclose on the property. Debt yield is calculated by dividing a property’s net operating income (NOI) by the total loan amount.
Commercial and multifamily real estate is generally identified by building quality or class. Class A, B, and C are the main categories, with “A” being best, and "C” being worst, though some properties may be referred to as “Class D.” Building classes are typically relative to the quality of properties offered on the local real estate market.
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