How can we help? Call us at 360-455-1569 or email

Cash Flow Analysis of K-1s: Count ordinary business income?

Oscar asks:

My borrower is a 50% shareholder for a business filing a 1120S. The K-1 indicates $276,970 in ordinary business income and $176,914 in...
Continue Reading
Business Loan Financial analysis

Can your Borrower really pay you back?

What is on your list?

Business lenders, underwriters and credit analysts consider ability to repay as the primary risk mitigation in making a business loan. And credit analysis...

Continue Reading

Financial Statement vs Tax Return Balance Sheet

Mike asks:

Is it better to use the balance sheet from tax returns or company prepared financial statements for credit analysis of assets, liabilities and net...

Continue Reading
Lenders Online Training

Bankers Online Training – Five free modules

Actually helpful! Have you considered banker’s online training but have suffered through ‘talking heads’ videos or ‘recorded webinars’ that stay on the same slide...
Continue Reading

Guaranteed Payments: C&I vs CRE treatment

Arthur asks:

Should 1065 K-1 guaranteed payments be subtracted from company cash flow when finding debt service? Most of my career has centered on CRE loan...

Continue Reading
Business Loss

Positive Retained Earnings: Disregard loss?

Fred asks:

Normally a loss from a C Corp is used as a reduction in the qualifying income of an individual. However, if the C Corp still shows a positive...

Continue Reading

When are capital gains recurring cash flow?

Sheilah asks:

Are capital gains ever considered a cash event and are they ever to be included in calculating cash flow available for debt service?

Continue Reading

When Financial Statements and Tax Returns don’t match

Krista asks:

What is the best way to tackle it when you receive company prepared financials and tax returns and the reconciliation seems to be universes apart? I...
Continue Reading

Should declining S Corp ordinary income preclude use of positive rental cashflow?

Ben asks:

I have a borrower who owns 100% of an S-Corp. The S-Corp is a construction company and it also has a large rental portfolio....
Continue Reading