Talos Guides
Capital Structure
Model debt, equity, DSCR, LTV, debt yield, and cash-on-cash impact.
Purpose
Capital structure explains how financing changes risk, returns, and report readiness.
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When to use it
NOI and price are known.
Debt assumptions are missing.
A report or portfolio review calls out leverage.
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Inputs needed
Loan amount
Interest rate
Amortization
Term
Equity tranches
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How to read the output
DSCR and debt yield measure coverage.
LTV measures leverage.
Cash-on-cash depends on equity and debt service.
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Common mistakes
Using loan proceeds without debt service.
Ignoring amortization.
Treating high leverage as return without risk.
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Next steps
Sensitivity
Hold/Sell/Refi
Reports and exports
Professional note
Lender terms and covenant tests should be verified with qualified financing professionals.