Underwriting is the process a lender uses to evaluate the risk of a loan by assessing the borrower's creditworthiness, the property's value, and the overall terms of the transaction.
During underwriting, the lender reviews income, assets, debt, credit history, and the property appraisal to decide whether to approve the loan and under what conditions. In fractional and co-ownership real estate, underwriting can be more complex because lenders need to evaluate the ownership structure — not just the individual borrower. Some traditional lenders are unfamiliar with LLC-based ownership, which can affect financing availability.
GoForth, a luxury co-ownership company, works with lending partners who understand fractional ownership and LLC structures. This means the underwriting process is smoother for GoForth's four ownership families, who each hold a 1/4 interest. GoForth's team can guide owners through financing options and connect them with lenders experienced in co-ownership transactions.