conditionalRelated party
Rent paid above market to a related party
Rent paid to an owner-controlled EPC that exceeds market rent.
Rule
Add back the excess over documented market rent, or restate to the proposed post-closing rent under the new lease.
Evidence lenders expect
- Lease agreement
- Market rent survey or appraisal
- EPC return
Worked example
As reported
Rent $186,000
In the memo
Market rent $150,000 · add-back $36,000
The objection you will hear
No independent support for market rent.
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