SBA Eases 7(a) Credit Underwriting for Loans Less than $350,000 – The Official Notice
June 13, 2014
By Bob Coleman
Editor, Coleman Report
Fraud Friday has been preempted with news of SBA’s revision to the loan underwriting SOP 5010.
Simply, a strong credit score will replace lender underwriting requirements of
· Debt to Service Coverage Calculations
· Projected Cash Flow
· Credit Histories of all principals
· Analyzing the business strengths.
However, lenders will still need to perform the following:
· A brief history of the business
· A description of the the management team
· Owner/Guarantor analysis
· IRS Form 4506 for required tax returns
· Prudent lender test of debt to worth ratios and equity injections
· List of collateral
· Analysis of any affiliates impact of global cash flow