Use the REO tab to add information about property that the borrower(s) owns.

You do not need to create an REO for the property that is being purchased, but you must include a property being refinanced. You must also designate the property and occupancy type.

You may link mortgage liabilities to the proper REO by choosing a liability in the 'Liabilities' dropdown menu.

Sonar will assume the mortgage is to be paid off. You must specify in the liabilities section if the mortgage liability is to be subordinated or not paid off.

In addition to the information you need to enter for any property, you will also need to supply rental income and gross rental income factor.

Sonar will automatically compute the adjusted net rental income based upon your gross rental and occupancy factor input. This figure will then be listed as a debt or income for the respective REO in the Mortgage section.

Net Rental Income = Gross Rental Income - (Sum of Paired Liabilities Monthly Obligation + Monthly Taxes + Monthly Insurance + Monthly Maintenance + Monthly Misc.)

If the borrower is making a net profit from the investment property, the net profits from the REO will be added as a source of income in the Income tab.

If the borrower is taking a loss from the investment property (meaning net rental income is negative), the net deficit will be reflected in the corresponding liability in the Liabilities tab.

In either case, the net rental income controls the computed income or liability entry for the REO. The income/liability entry cannot be edited directly, as they are calculated based on net rental income. In order to modify these entries, adjust the net rental income field in the REO. The corresponding entry will be automatically updated.