Short answer
Sized proceeds are typically set at the lower of base-case and stressed-case sizing results.
What does the stress matter for the borrower?
Test lower income, higher expenses, higher rates and a delayed exit. The effect on proceeds depends on the loan structure and which underwriting constraint is binding.
How does it interact with debt yield and DSCR?
The stressed scenario must still satisfy minimum DSCR (often 1.10 to 1.15x) and debt yield (often 7.0 to 8.0 percent). If the stressed scenario fails, proceeds drop until both metrics work. Sponsors who present clear, defensible stress assumptions in the offering memorandum often get lenders to anchor on tighter stress.
Sources
- Quarterly Survey of Commercial/Multifamily Mortgage Bankers Originations · Mortgage Bankers Association · 2026-Q1
- Financial Stability Report · Board of Governors of the Federal Reserve System · 2025-11