Credit Myths
Cash out Refinances can be accomodated via the legacy small business rails. True/False
What is true?
We require more diligence on the use of funds however we are 4/4 in the NE this year on these requests.
The continuum limits for Conventional Loans and SBA loans are at what dollar amounts? (2 answers)
What are 2MM and 5MM respectively for conventional and SBA.
The two asset types that can be financed with an SBA 504 loan
What are real estate and equipment (Equipment with a useful life of at least 10 years).
Market Executives can approve pricing exceptions for legacy SB RM deals? True/False
What is false? We must follow SB pricing protocol
This group at the Bank can provide 100% OOCRE financing for this profession.
What are medical practices via Practice Solutions?
It is a non starter for the continuum and Small business underwriting in situations where the business owner is seeking NO PG. True/False
What is False ?
The small business underwriting team can accomodate opportunities without a PG. We have our first approval on the LI Team.
SB RM and BB Continuum opportunities are routed through the same credit underwriting team? True/False
What is True?
This lending product requires a minimum EBITDA of 1MM and separately 20% of day 1 liquidity to close.
What is an ABL Facility?
True/False Opportunities that have exactly 10MM in exposure are underwritten in the credit center
What is False - Opportunities up to 9,999,999 are underwritten in the credit center. Opportunities 10MM and over are underwritten by our regional credit team.
The MSA should be excluded when a credit opportunity exceeds this dollar amount
What is there is no maximum dollar limit for MSA engagement. The MSA should be engaged on all opportunities north of $2MM in exposure through requests north of $10MM and beyond.
In legacy BB all Medical Opportunities must all be sent to practice solutions for consideration. True/False
What is false- All opportunities under $2MM should be sent to practice solutions except for line of credit requests over $1MM. Other requests may be underwritten by practice solutions or from our credit center.
The definition for owner occupied real estate is at 40% occupancy for the sb/continuum and practice solutions. True/False
What is False - For legacy small business rails/practice solutions that number is 30%. In Business Banking it is strongly suggested that we have at least 10% occupancy.
A BB RM has a $3MM OOCRE opportunity with sales under 5MM. These are the 2 primary options to proceed?
What are ?
1. Send the opportunity through the continuum
2. Send the opportunity to a legacy SB Banker for process.
*In certain cases we could also entertain a 1071 exception.
This is the maximum term and amortization on a standalone 7a buy out loan.
What is 10 years?
This recent policy change requires us to order a DDI for any credit action where the exposure exceeds this dollar amount
What is $5MM? (This is for both rails)-
* In legacy small business for high risk industries this cut off is at $3M.
Our commercial BDOs officially cover the offices of these two commercial real estate outfits
What are NAI and Lee & Associates?
This is the percentage of personal liquidity a doctor should have (net) when applying for a practice solutions loan
What is 7% or greater of the request?
Our primary source of repayment is cash flow for all of our legacy BB credit products except this one.
What is an ABL facility?
PSOR is Asset Conversion
The 1919 form is used to collect and validate information on this specific product.
What are 7a loans?
This SBA product has a maximum exposure limit of $500,000.
What is the SBA Express facility - (Either a 10 year term loan or a revolver to term for 12 months with a 9 year amortization)
In business legacy business banking we utilize yield maintenance as the primary pre-payment language on our fixed rate term loans. (True/False)
What is False? We use a 5,4,3,2,1 as our standard on most terms 10 years or under up to 10MM.
This type of limited borrowing base facility in legacy Business Banking can extend up to 5 years and does not require a field exam by policy.
What is an Asset Test Line.
Line of Credit Requests over 1MM for qualified medical professionals must be routed to this group.
What are the MSA's for either our centralized credit or regional credit team. This serves as an exception and are not routed through practice solutions.
On continuum opportunities where we have both CPA financials statements and tax returns, the small business team will default to tax returns for underwriting. True/False
False - This is a myth! Although we require tax returns always on continuum deals, we will default to the highest level of financial statements for underwriting.
Land loans cannot be done in small business or on the small business rails. True/False
What is false? They certainly CAN, the term is typically a 5 year max with an intent to build.
Name at least 5 Franchise concepts that we can leverage for Enterprise Value lending from our franchise lending team.
What are Servepro, Little Ceasars, Aamco, Meineke, Pet Supplies Plus, State Farm, Jiffy Lube, Ace Hardware, Matco Tools, UPS Store, Molly Maid, Merry Maids, & Benjamin Moore to name a few.
Small Business Continuum does not include or test loan covenants. True/False
What is False?
Our equipment finance team can monetize equipment purchased in cash more than 12 months in the past. (True/False)
What is true? Previously purchased equipment in cash over 12 months ago can be monetized with a valuation.
The advance rate for medicare and medicaid government guaranteed receivables is at this suggested percentage.
What is 0?
Medicare and Medicaid receivables are difficult to perfect, therefore margin value should typically be zero.
This many markets have closed a continuum deal thus far in 2025.
What is - 5 of 20 NE Markets have closed on a continuum opportunity.
This lending vehicle can provide up to 120% value on the purchase of an asset.
What is equipment finance?
100% of the asset plus 20% in soft costs
Name the 3 of the 4 contractor guidelines on our small business rail
What are years in operation (+5), Fixed Charge > 2x, Total Liquidity (business and personal) > 25% TRE, and Total Liquidity (business and personal) > 50% of unsecured TRE
Name 1 of the only 3 franchise brands that we will consider pure start up financing for?
What are the the UPS Store, Pet Supplies First, and Christian Brothers.
(Christian Brothers is a franchised automotive repair chain)