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How to use · Term Sheet Reader

How to use the Term Sheet Reader.

Six steps from raw term sheet to a side-by-side comparison and selection memo. Plus practitioner tips on recourse language, prepay structures, and where comparisons typically go wrong.

Practitioner-built ·Pairs with the AI Team when it ships Q3 2026 ·Human review required on every output

A. Six steps

From download to deliverable
  1. 1

    Download the comparison workbook

    You receive a DOCX with the reader's reference guide (clause-by-clause translations of standard term-sheet language) plus an XLSX with the comparison matrix template. Save both into the deal folder alongside the raw term sheets you received.

  2. 2

    Load the raw term sheets into the file structure

    The comparison XLSX is built for 2-4 term sheets at a time. Save each raw PDF / DOCX as TS_<Lender>_<YYYY-MM-DD>.pdf in the deal folder. Reference each in the comparison header so you can audit which version was compared if a question comes back later.

  3. 3

    Fill the comparison matrix row-by-row

    Rows: Rate · Spread · Term · IO Period · Amortization · Recourse · Carve-outs · Reserves · Prepay · Lockout · DY / DSCR Trigger · Reporting · Fees · Closing Timeline. For each lender column, fill verbatim from the raw TS — do not paraphrase. Paraphrasing is where comparison errors happen.

  4. 4

    Flag variances using the variance column

    The rightmost "Variance" column auto-highlights when two columns disagree on the same row. Read these as discussion points, not as right-vs-wrong. Some variances are material (recourse, prepay) and some are noise (closing-timeline guess).

  5. 5

    Draft the selection memo from the comparison

    The DOCX guide includes a one-page selection-memo template: top 3 variances · why-we're-picking-X · open questions for the chosen lender · fallback if X falls out. Drop the memo into the deal folder; circulate to the sponsor / IC.

  6. 6

    When the Term Sheet Comparison Skill ships, paste raw TS in directly

    The Term Sheet Comparison Skill (forthcoming Q3 2026) reads 2-4 raw term-sheet PDFs and fills the matrix automatically with variance flags. Today the matrix is manual fill; with the skill, paste-in is the input and the filled matrix + selection memo are the output.

B. Practitioner tips

Things the file won't tell you on its own
  • Recourse language is where most TS comparisons go wrong. "Carve-out guaranty" can mean five different things — read the actual definition before classifying.
  • Prepay structures: yield maintenance, defeasance, step-down, and open prepay are NOT interchangeable. Note the exact mechanism in the matrix, not just "prepay terms apply."
  • Spread vs all-in rate: most TS quote spread over an index. Capture both — spread + index reference + floor + cap — to make rate comparisons honest.
  • Closing timeline: every TS lies about this. Discount stated timelines by 30-50% based on lender type (banks longer than debt funds).
  • IO period + amortization combine to drive sizing more than the headline rate. A 10-year IO at 6.5% sizes higher than a 30-year amort at 6.0%.
  • When two TS look identical on paper, the difference is usually in carve-outs, reporting cadence, or lender personality. Capture the soft items in a note column.

C. Scope & limits

What this template is — and is not
  • Not a legal review tool. The reader translates standard clauses; counsel reviews the actual document. Material variances need legal sign-off before counter-offering.
  • Not a counter-offer drafter. The selection memo identifies the discussion points; the actual counter-offer goes through the Capital Markets Associate (or the broker representing).
  • Not for non-CRE term sheets. Conventions vary materially across asset classes; this is built for stabilized CRE debt + bridge / construction CRE debt.
  • No automatic credit-box check. Pair with the UW Workbook + Loan Sizing skill if the comparison needs to test which TS actually sizes to the proceeds you need.

D. Pairs with

Components that operate on or alongside this template

  • Term Sheet Comparison Skill

    Skill (forthcoming Q3 2026)

    Reads 2-4 raw term sheets (PDF/DOCX), fills the matrix, flags variances, drafts selection memo.

  • Legal Reviewer

    Agent (forthcoming Q3 2026)

    Surfaces non-standard clauses for counsel review before counter-offering.

  • Capital Markets Associate

    Agent (forthcoming Q3 2026)

    Owns the counter-offer + ongoing lender dialogue. The matrix is the prep work.

  • UW Workbook

    Template (available now)

    Use to verify each TS actually sizes against your required proceeds.

  • Lender Edition

    Data (available now)

    Source of the lender background — who else they've quoted, how aggressive they typically are on each row.

Next step

Build the full stack around it.

This template is the work surface for a specific AI agent + skill workflow. Open the Company Builder and assemble the matching agents when they ship Q3 2026.

Open the Company Builder Back to Term Sheet Reader