Sources and Uses: How Much Equity to Raise
A sources and uses table is a two-column list. The uses are everything the deal has to pay for: the price, closing costs, loan costs, renovation, reserves and fees. The sources are where that money comes from: the loan, your own cash and investor equity. The two columns must match to the dollar, and the investor equity you ask for is whatever is left after the loan and any sponsor money. If you are a sponsor, DoorRaise helps you raise that equity from your own friends and followers, but the table comes first.
This post is part of our guide to real estate syndication. It shows how to build the table step by step, with a hypothetical example, and how to turn it into a raise target. Rules are as of October 2026.
What goes in a sources and uses table?
Two lists, one total. The uses list is every cost from signing the contract to the day the deal can run on its own. The sources list is every dollar that pays for them.
Uses
Typical lines for an apartment purchase:
- Purchase price. What the seller receives.
- Closing costs. Title insurance, recording, transfer taxes where they apply, third-party reports and the attorneys' bills for the deal.
- Loan costs. The lender's origination fee, appraisal, legal fees, and any required interest rate cap (see interest rate caps).
- Renovation budget. The planned work, plus a contingency. The plan behind it is described in the value-add business plan.
- Reserves. Money set aside for repairs, taxes, insurance, interest or lost rent, as the loan and the plan require.
- Fees. Any acquisition or other fees the offering documents allow the sponsor to take, and the platform and escrow fees.
- Working capital. Cash to run the property in the first months.
Sources
- The loan. Sized by the lender from the building's value and income, not by the sponsor's wish. A lender's term sheet sets the amount.
- Sponsor equity. Cash the sponsor puts in, if any. It should be real money from a real source, and the offering documents should describe it.
- Investor equity. The rest, raised under the offering. This is the number the raise has to hit.
Not every deal has every line, and the right list depends on the building and the loan.
How do you build it, step by step?
Work from the top down.
- Start with the price. Use the contract price, not the asking price.
- Add acquisition costs. Get estimates for title, reports, legal and closing, and add them. Ask your title company for a good-faith estimate early.
- Add loan costs. Use the lender's term sheet. Include fees you pay at closing and any money the lender holds back or requires you to deposit.
- Add the renovation budget and a contingency. Use bids, not guesses. Leave a cushion for what the bids miss.
- Add reserves and working capital. Ask what the lender requires, then add what the business plan needs. A building that loses money for a few months before the plan takes hold needs cash to bridge it.
- Add fees. Include only fees stated in the offering documents.
- Add it up. That is total uses.
- Subtract the loan. The loan amount comes from the term sheet.
- Subtract sponsor equity. Whatever you will really contribute.
- The remainder is investor equity. That is your raise target.
If you change any line, the raise changes. That is why the target is a result of the table and not an input to it. The free raise planner walks through the same arithmetic.
A hypothetical example
This example is hypothetical, for illustration only. The numbers are round, are not a market benchmark and are not a forecast.
| Uses | Amount |
|---|---|
| Purchase price | $5,000,000 |
| Closing costs | $100,000 |
| Loan costs | $60,000 |
| Renovation budget | $500,000 |
| Renovation contingency | $50,000 |
| Reserves | $150,000 |
| Acquisition fee to the sponsor (if the documents provide one) | $100,000 |
| DoorRaise closing fee (includes state filing fees) | $5,000 |
| Escrow fee, working capital and other costs | $35,000 |
| Total uses | $6,000,000 |
| Sources | Amount |
|---|---|
| Loan | $3,750,000 |
| Sponsor equity | $100,000 |
| Investor equity | $2,150,000 |
| Total sources | $6,000,000 |
The investor equity of $2,150,000 is the leftover: $6,000,000 minus $3,750,000 minus $100,000. If the lender will lend $3,500,000 instead, the raise rises by $250,000 to $2,400,000. If the renovation contingency grows by $50,000, the raise grows by the same amount. Every use change moves the raise one for one.
Two notes on the fees. DoorRaise's $5,000 closing fee is charged at closing, only if the deal closes, and is paid from the money raised; it includes state filing fees. The $500 setup fee is paid by the sponsor when the deal is submitted and is not a use of the deal's money. The deal's company pays the escrow agent's fee. The $3,500 yearly fee comes out of the property's income, so it belongs in the operating budget, not here. See pricing for the full list. Whatever fees you pay yourself, they must match the offering documents.
Why should you pad for surprises?
Because the table is built before the deal closes, on estimates. Costs change between the letter of intent and the closing day. Reports find repairs, a lender asks for a larger reserve, or an insurance quote arrives higher than expected.
There are two ways to deal with that:
- Add a cushion to the raise. Build the contingency into the uses, as in the example, and be open about it in the documents.
- Keep a plan for a shortfall. Decide in advance whether you would cut renovation scope, delay it, reduce the sponsor fee or ask for a capital call. Investors should read how that works in the operating agreement, which is why a capital call clause matters.
Asking investors for a little extra later is harder than raising a sensible cushion at the start. But do not pad so much that investors fund idle cash for the sake of comfort.
How do the minimum raise and partial closing fit in?
Your table needs a floor: the least equity at which the deal still works. Below it, you cannot close or the plan breaks. The minimum raise is the amount that must be committed before escrow releases funds, and it should come from the table, not from a hunch. Our post on the minimum raise and partial closing explains how to set it and what happens if the raise falls short.
A deal with a lower minimum than its needs is a promise it cannot keep. A common reason for a failed close is a minimum set from hope, not arithmetic. Test the table at the minimum and ask what you would cut.
How does the table show up in the offering and on the deal page?
Investors should see the full table, with the same numbers in every document. It belongs in the private placement memorandum (see how to read a PPM) and on the deal page, where a summary tells friends and followers how much is being raised and what it pays for.
Antifraud rules apply to what you say about the use of the money. If a fee is not in the table or the documents, do not take it. If a number changes, update every place it appears. For the way debt and equity sit together, see the capital stack. To learn what a new sponsor needs in cash before any of this, read how much money to start a syndication.
Our take
Our view is that the best sponsors treat the raise target as the output of a table anyone can check. When a sponsor says "we are raising $2 million" without a table behind it, ask for the table. When you are the sponsor, put it in front of investors before they ask. It makes you look prepared, and it keeps you honest with yourself about what the deal needs.
How DoorRaise fits in
DoorRaise helps sponsors raise equity for apartment buildings with 5 or more units under Rule 506(b) or 506(c). It prepares the offering documents from the sponsor's inputs, coordinates escrow with an independent escrow agent named on the deal page, and handles filings. It does not set your price, your loan or your budget. Those inputs are yours.
Raise your apartment deal from the people who already follow you.
DoorRaise is built for apartment buildings with 5 or more units: one link for the deal, escrow until closing and a standard fee card.
Run your numbers in the raise planner, then start your sponsor page or see the fees.
FAQ
What is a sources and uses table?
A two-column list of every cost a deal must pay (uses) and every source of money that pays for it (sources). The totals must match.
How much equity do I need to raise for an apartment deal?
Total uses minus the loan minus any sponsor equity. The loan comes from the lender's term sheet, so get that early.
Should I raise more than the table says?
A reasonable contingency belongs inside the uses and the documents. Raising well beyond need leaves investors' money idle, so explain every cushion.
Does the sponsor have to put in money?
Not by law in a syndication, but many investors expect sponsors to contribute. If you do, say how much and where it comes from in the documents.
Where do sponsor fees go in the table?
As uses, if the offering documents allow them to be paid at closing. Every fee should match the documents and the deal page.
What happens if I raise less than the target?
That depends on your minimum raise and the offering terms. If the minimum is not met, escrowed money goes back to investors. See the minimum raise guide.
Sources
- 17 CFR 230.506, Exemption for limited offers and sales without regard to dollar amount of offering
- 17 CFR 240.10b-5, Employment of manipulative and deceptive devices
- 17 CFR 240.10b-9, Prohibited representations in connection with certain offerings
This article is general information, not legal, tax or investment advice. Talk to a securities attorney and a CPA about your deal. DoorRaise is not a law firm, broker-dealer, investment adviser or funding portal.