Also called: Lease doc loan
Lease-doc finance
Lease-doc finance is a commercial property loan assessed primarily on the rental income the property produces rather than on the borrower's wider financial statements. The lender relies on the lease, the tenant and the interest cover the rent provides.
What is a lease-doc finance?
Lease-doc finance is a commercial property loan assessed primarily on the rental income the property produces rather than on the borrower's wider financial statements. The lender relies on the lease, the tenant and the interest cover the rent provides.
Example
An investor buys a leased warehouse where the annual rent covers loan interest 1.5 times, so the lender assesses on the lease rather than tax returns.
Why it matters
It suits investors with strong tenanted assets but complex or unfinalised personal financials.