Banking Terms Flashcards
Amortize
Gradually write off the initial cost
Pass through entity
Entity that does not cash flow - money passes through
Repayment terms
Owe payments
First Deed of Trust
We get property of default
P Card
Card
Carry Note
Carry back
Mitigate
S
Aggregate debt
S
Aggregate Debt
Respect to an obligation, the sum of the following as of the date of determination 1) obligors attribute liens in respect of sake and lease back transaction entered into after the date of the initial issuance of the securities pursuant to section 3.07
Internal Asset TeM
BBLC
Trouble debt
Arrangements
Forebearance
Agreement
Talk more forcibly
Demand letters
Loan Fees
Environmental evaluation $350
Evaluation/appraisal $700
Titles $2,000
Doc fee $150
DSCR
Debt Service Coverage Ratio
Net operating income by the annual debt
Cash flow generated by the business will cover the new commercial loan payment by 1.25x
Debt service
Debt service is the total of all principal and interest paid on debts over the course of a year.
Debt services are not reported on financial statements
They are reported on a Balance Sheet
Cash flow
Current assets minus current liabilities
Attrition
Loosing out the back end
Curtailments
iDK
Leverage
Borrow funds from a financial institution to buy more of an asset.
Highly leveraged
A company has more debt than equity
Balance sheet
A company’s financial position at a point in time.
What are the components of a balance sheet
Assets
Liabilities
Owners (stockholders) equity
Assets
Things a company owns:
Cash, petty cash, temporary investments, accounts receivable, inventory, supplies, prepaid insurance, land, land improvements, buildings, equipment, goodwill
Contra assets
Asset accounts with balances: Allowance for doubtful accounts, accumulated depreciation- buildings, accumulated depreciation- equipment, accumulated depletion
Classification of assets
Assets are presented in distinct groups, categories:
Current assets, investments, property, plant, and equipment, intangible
S Corp
Pass through tax entities. No income is taxed at the corporate level. Instead the profit and loss passes through the business and reported to the owners personal tax return
C Corp
Separately taxed entities. They pay taxes at the corporate level. Possible double taxation if corporate income is distributed to business owners as dividends, which are considered personal income
Factoring
Slow receivables
Articles of Organization
Outlines the initial statements required to form a limited liability company. Certificate of organization once approved, the orginazation is legally an LLC
Operating agreement
Agreement between an LLC and financial managerial rights and duties
What is the BBLCs expectation for leverage
3:1
What factors are considered in decisioning
Aggregate Business credit score
Cap ex
H
Fixed assets
H
Reliance Letter
A letter from one party to another party allowing them to Rey on the contents of a report
Intended user
This is added to Evaluations for SBA to have access
Mountain West Small Business committee of 5
They are the loan closers. Need three to sign off
Collecting Tickler items after approval is often referred to as _____________ _________
Screen out
LIBOR
London Interbank Offerred Ray:
Interest rate that is calculated each day based in the rate that international banks lend money to each other in a short term basis
SWAP
Financial derivatives that companies use to exchange interest rate payments with each other
5-4-3-2-1 penalty
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What is Debenture
An unsecured loan certificate issued by a company, backed by general credit rather than by specified assets
Defines the interest owed
Statement that Acknowledges the debt
