Correctly Calculate Global Cash Flow the SBA Way — SOP 50 10 5 (K)
Date: Wednesday, October 2, 2019
Time: 2:00 p.m. Eastern
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SBA 7(a) and 504 loan underwriters must know the required cash flow adjustments demanded by SBA to correctly calculate your borrower’s repayment ability.
This webinar will teach you exactly how to calculate cash flow so you don’t make a mistake that voids the SBA loan guaranty.
A lender was criticized by SBA’s Inspector General for failing to correctly calculate global cash flow and recommended denial of the guaranty.
The OIG wrote, “The lender did not approve the loan in accordance with SBA’s origination and closing requirements. Specifically, the lender did not consider the impact that affiliated businesses—owned by the borrower’s president—had on loan repayment ability. Additionally, the loan file did not provide the cash flow needs of the borrower’s president; therefore, we were unable to determine its impact on repayment ability. Further, the lender used questionable financial information and unsupported projections in its repayment ability analysis. Based on these deficiencies, the lender did not demonstrate reasonable assurance of repayment for the SBA loan.”
Your problem is SBA’s SOP tells you what to do, but not how to do it.
(a) Unfunded capital expenditures;
(b) Non-recurring income;
(c) Expenses and distributions;
(d) Distributions for S-Corp taxes;
(e) Rent payments;
(f) Owner’s Draw; and/or
(g) Global cash flow analysis that includes assessment of impact on cash flow to/from any affiliate business
Bob Coleman will discuss each sub point in detail to tell you what exactly SBA expects.
Importantly, he’ll review SBA’s affiliate rules and how to use the small business borrower’s tax returns to calculate global cash flow.
Ensure your SBA Loan Underwriters Know How to Calculate Global Cash Flow to be Compliant with SBA’s SOP 50 10 5 (K)
Your staff will be able to confidently complete SBA form 1920 certifying the borrower is eligible for SBA financing.
- Calculating global cash flow with business and and personal tax returns
- Determining affiliates affected by SBA’s global cash flow rules
- Permissible SBA cash flow add backs
- Mandatory SBA cash flow subtractions
- Defining SBA’s debt service coverage
- Global cash flow rules for loans over $350,0000
- Global cash flow rules for loans less than $350,000
- Global cash flow rules for SBA Express loans
- Determining unfunded capital expenditures;
- Defining non-recurring income;
- Taxes and global cash flow
Lance Sexton served as Deputy Director of the SBA Little Rock Commercial Loan Servicing Center managing the Servicing of SBA Loans, the liquidation of SBA Express Loans, and the Liquidation of SBA 504 loans in a 24 state area. Lance has 30 years of experience in the origination, servicing, and liquidation of SBA Loans, ten years of experience directly managing portfolios of SBA loans that are both performing and nonperforming, and six years of experience as a small business owner.
Bob Coleman is the Author of “Money Money Everywhere and Not a Drop for Main Street.” He is the Publisher of the Coleman Report, a trade newsletter and website for SBA and small business lenders. He produces online training videos and webinars for small business lenders to teach them to make less risky loans to Main Street.
Certificates of Participation
All Coleman Webinar attendees will receive a certificate of participation. This documents your continuing education history for SBA and your regulators.
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About Coleman Webinars
Coleman is the largest producer of small business banking video webinars and online training for the banking industry.
Our faculty are professional instructors are the absolute experts in their fields.
Why a Coleman Training Webinar?
It’s very cost effective. No airfare, no hotels. Just cram as many people as you wish into your conference room and turn on the computer. You have several options to view the program. You may watch on screen, or listen in on your phone.
You can choose to have any many connections nationwide as you wish when you purchase unlimited access for only $589.
A great benefit of the program is that you may have your questions answered by the faculty. All of our webinars are recorded. Buyers of the unlimited site license option will receive a DVD recording of the event to share with anyone you wish.
A transcript of the program is also provided to purchasers of the unlimited site license.
How it Works
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Telephone Only Option
You may also choose to listen to the program on your telephone. The phone number will be provided with the handouts.
You will receive the PDF handout via email the day before the event. These may be distributed to all of your attendees.
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The Fine Print
1) The single user registration fee of $489 is based on location not attendance. You may have as many people in one location attend. You may distribute the materials to anybody in your company.
2) For only $100 more ($589), you may invite as many people from your institution from as many locations as you wish. (You also get the reply link and transcript!) We will forward you a link that allows you to sign up as many people as you wish.
3) Substitutions are allowed at no charge.
4) Cancellations receive a 100% credit for any Coleman product.
5) As with all our products, we offer a 100% money back satisfaction guaranty — no questions asked.
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