• Nadlan Capital Group – USA Real Estate Financing for Foreign Nationals and Residents

  Loan #1359 Case Study – Buying in NY with Open Permits & a Surprise High Apprais

  Posted by Nadlan Group on May 15 at 21:04

  Loan #1359 Case Study – Buying in NY with Open Permits & a Surprise High Appraisal

  Snapshot

  • Borrower: Roy (foreign national)

  • Deal: Purchase of a multi-unit property, New York

  • Challenge #1 – Open permits: Several minor electrical / elevator permits remain outstanding; seller must close them before underwriting can resume.

  • Challenge #2 – Appraisal access: This private DSCR lender releases only the value summary before closing (NY regulation & lender policy); the full report is issued after funding.

  • Surprise upside: Preliminary value > contract price of $1.5 M – great news, with a few caveats (see below).

  1 Why open permits matter

  Lenders need clear title and a Certificate of Occupancy free of violations. Open permits signal unfinished work that can:

  1. Delay closing until the municipality signs off.

  2. Trigger a rehab hold-back or escrow if the work is minor but time-sensitive.

  3. Reduce the “as-is” value the appraiser can assign.

  Nadlan playbook

  • Identify permits early (title search or DOB website).

  • Push the seller to file final inspections & sign-offs.

  • Document the timeline; if > 30 days, expect the lender to pause the file (exactly what happened here).

  • Resume underwriting once the updated title shows “zero open items.”

  2 Appraisal rules with this lender

  In many NY DSCR programs the AMC delivers the full PDF only after the loan closes. Until then the lender will share:

  • Market value

  • Repair conditions (if any)

  • Rent comparable grid summary

  Roy requested the full report on 5 May; Denver explained the policy and committed to relay the value as soon as underwriting finished its two-day review window.

  3 What if the value comes in higher than purchase price?

  1. LTV is still capped to the lower of purchase price or appraised value.

  2. The upside is instant equity and a stronger DSCR—great for future cash-out or portfolio leverage.

  3. If the spread is substantial, you can:

     • Re-negotiate closing terms (seller credit, quicker close).

     • Ask the lender about a CEMA structure (NY-only) to save mortgage-recording tax on a later refinance.

  For Roy the prelim value exceeded $1.5 M, so equity improves, but loan amount will still hinge on the contract price until permits are cleared.

  4 Next steps for Roy

  1. Seller closes permits (target mid-August).

  2. Title & updated purchase contract sent to lender.

  3. Underwriting restarts; fresh 30-day bank statements and PM agreement uploaded.

  4. Commitment letter issued → closing scheduled.

  Key takeaways

  • Order title early to catch open permits before you pay for the appraisal.

  • Expect some NY private lenders to withhold the full appraisal until funding—plan your questions accordingly.

  • A high appraisal doesn’t automatically raise your loan amount, but it does increase your net worth on day one.

  • Nadlan Capital can pause and restart DSCR files without extra fees—use that flexibility when sellers need time to cure issues.

  Considering a NY purchase with moving parts?
  👉 Talk to Nadlan Capital Group – we shop 3,000+ lenders so you get the right fit.

  Full loan thread & document checklist: https://www.forumnadlanusa.com/groups/…/loan-1359-roy-purchase-new-york-lender-2486/

  Hashtags
  #Loan1359 #OpenPermits #NYRealEstate #DSCRLoans #ForeignNationalFinancing #HighAppraisal #NadlanCapitalGroup #CaseStudy #RealEstateInvesting #NadlanNetwork

  

  

  Nadlan Group replied 3 weeks, 4 days ago 1 Member · 0 Replies

  • Appraisal
  • New York
  • Permits
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