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Replacement Reserve Schedule <br />Adequate replacement reserves must be calculated regardless of whether actual reserves are provided for on the owner's operating statements <br />or are customary in the local market. This represents the total average yearly reserves. Generally, all equipment and components that have <br />a remaining life of more than one year - such as refrigerators, stoves, clothes washers/dryers, trash compactors, furnaces, roofs, and carpeting, <br />etc. - should be expensed on a replacement cost basis. <br />EquipmentReplacementRemainingBy Applicant/Lender <br />CostLifeAppraiserAdjustments <br />Stoves/Ranges@$600 ea.÷30 Yrs. x 1 Units =$20$ <br />Refrigerators@$ea.÷Yrs. x Units =$$ <br />Dishwashers@$ea.÷Yrs. x Units =$$ <br />A/C Units@$ea.÷Yrs. x Units =$$ <br />C. Washer/Dryers@$ea.÷Yrs. x Units =$$ <br />HW Heaters@$350 ea.÷35 Yrs. x 1 Units =$10$ <br />Furnace(s)@$3,800 ea.÷35 Yrs. x 1 Units =$109$ <br />(Other)@$ea.÷Yrs. x Units =$$ <br />Roof@$12,000÷35 Yrs. x One Bldg. =$343$ <br />Carpeting (Wall to Wall)Remaining <br />Life <br />(Units) <br />128 Total Sq. Yds. @$13 Per Sq. Yd.÷10 Yrs. =$166$ <br />(Public Areas)Total Sq. Yds. @$Per Sq. Yd.÷Yrs. =$$ <br />Total Replacement Reserves. (Enter on Pg. 1)$648$ <br />Operating Income Reconciliation <br />– <br />$37,440$10,588=$26,852÷ 12 =$2,238 <br />Effective Gross IncomeTotal Operating ExpensesOperating IncomeMonthly Operating Income <br />– <br />$2,238$=$ <br />Monthly Operating IncomeMonthly Housing ExpenseNet Cash Flow <br />(Note: Monthly Housing Expense includes principal and interest on the mortgage, hazard insurance premiums, real estate taxes, mortgage <br />insurance premiums, HOA dues, leasehold payments, and subordinate financing payments.) <br />Underwriter's instructions for 2-4 Family Owner-Occupied Properties <br />If Monthly Operating Income is a positive number, enter as "Net Rental Income" in the "Gross Monthly Income" section of <br />Freddie Mac Form 65/Fannie Mae Form 1003. If Monthly Operating Income is a negative number, it must be included as a <br />liability for qualification purposes. <br />The borrower's monthly housing expense-to-income ratio must be calculated by comparing the total Monthly Housing Expense <br />for the subject property to the borrower's stable monthly income. <br />Underwriter's instructions for 1-4 Family Investment Properties <br />If Net Cash Flow is a positive number, enter as "Net Rental Income" in the "Gross Monthly Income" section of Freddie Mac <br />Form 65/Fannie Mae Form 1003. If Net Cash Flow is a negative number, it must be included as a liability for qualification purposes. <br />The borrower's monthly housing expense-to-income ratio must be calculated by comparing the total monthly housing expense <br />for the borrower's primary residence to the borrower's stable monthly income. <br />Appraiser's Comments (Including sources for data and rationale for the projections) <br />The estimate for expenses was determined by a history of appraising small residential income properties and the owners experience managing <br />and maintaining rental properties. <br />Scott Lepman, SRA, RM10/09/2020 <br />Appraiser NameAppraiser SignatureDate <br />Underwriter's Comments and Rationale for Adjustments <br />Underwriter NameUnderwriter SignatureDate <br />Freddie MacFannie Mae <br />Page 2 of 2 <br />Form 998 Aug 88Form 216 Aug 88 <br />Form INC2 - "TOTAL" appraisal software by a la mode, inc. - 1-800-ALAMODE <br /> <br />