The Wholesale Multifamily Underwriting Checklist
Short answer: Wholesalers who consistently assign small multifamily contracts underwrite like the end-buyer's lender before they sign with the seller. This 27-point checklist covers what to collect pre-signing, the buyer-attractiveness math (cap rate, DSCR, cash-on-cash, exit IRR), lender-readiness items, and the documents the buyer's lender asks for in week one.
A wholesale multifamily deal that doesn't close is worse than no deal at all — it burns the buyer relationship you spent six months building. The wholesalers who consistently assign small multifamily contracts share one habit: they underwrite like the end-buyer's lender before they sign with the seller.
What do you collect before signing with the seller?
- T-12 operating statement, signed.
- Current rent roll, signed and dated.
- Last 24 months of utility bills.
- Property tax bill — and the assessor's reassessment-on-sale rule for the county.
- Existing insurance policy and 5-year loss runs.
- List of capital improvements last 5 years (with receipts where possible).
- Service contracts (laundry lease, pest, landscaping) — assignable?
- Survey and title commitment ordered.
- Estoppels for at least 80% of units.
- Roof and HVAC age verified, ideally with a 4-point inspection.
What makes a deal attractive to the buyer?
Your buyer is going to test against:
- Underwritten cap rate vs. market cap rate (target: in-market or 50bps wide).
- DSCR at 75% LTV at today's rate (target: ≥ 1.25 with reserves).
- Cash-on-cash year 1 (target: ≥ 6% in primary metros, ≥ 8% in tertiary).
- Exit IRR at 5 years assuming flat caps and 3% rent growth (target: 14–18%).
Lender-readiness items
- Does the borrower's W-2 / Sch E support the personal guaranty?
- Is the property in a flood zone? (changes insurance materially)
- Is the loan recourse or non-recourse at this loan size?
- Have you priced 30/30 amortization vs 30/25?
- Have you compared agency, bank, and DSCR-only quotes?
Documents the buyer's lender will ask for in week 1
- Year-to-date P&L
- Bank statements 6 months
- Property management agreement (if any)
- Borrower PFS
- Borrower SREO (Schedule of Real Estate Owned)
- 1003 application
Final assignment-day checks
- Assignment fee disclosed in writing? (in some states this is mandatory)
- Earnest money replacement plan if assignment fee is paid by cashier's check?
PathIQ runs items 11–14 automatically the moment you enter the deal, and it generates the 1003 (item 25) so you can hand the buyer a near-complete package on day one. That alone has shaved a week off most of the wholesale closes we see.
Frequently asked questions
Why should a wholesaler underwrite like the end-buyer's lender?
Because a deal that doesn't close burns the buyer relationship you spent months building. Underwriting to the lender's standards before you sign with the seller means the numbers still hold when the buyer's lender runs them, so the assignment actually funds.
What documents should I collect before signing with the seller?
Get the signed T-12, a signed and dated rent roll, 24 months of utility bills, the tax bill plus the county's reassessment-on-sale rule, the insurance policy with 5-year loss runs, capital-improvement history, service contracts, survey and title, estoppels for at least 80% of units, and verified roof/HVAC age.
What metrics does a buyer test a wholesale deal against?
Underwritten cap rate versus market (in-market or about 50bps wide), DSCR at 75% LTV at today's rate (target ≥1.25 with reserves), year-1 cash-on-cash (≥6% in primary metros, ≥8% in tertiary), and a 5-year exit IRR assuming flat caps and 3% rent growth (target 14–18%).
What will the buyer's lender ask for in week one?
Typically year-to-date P&L, six months of bank statements, the property management agreement if any, the borrower's PFS and SREO, and the 1003 application. Having these ready keeps the loan moving instead of stalling on document requests.
How does PathIQ speed up the wholesale underwriting checklist?
PathIQ runs the buyer-attractiveness math (items 11–14) automatically the moment you enter the deal, and it generates the 1003 (item 25), so you can hand the buyer a near-complete package on day one — which has shaved about a week off most wholesale closes we see.