1. Schedule C – Business Income, Schedule E –Royalty and Rental Income, and Schedule F – Farm Income Lisa Osborne, LoanVantage Product Manager Melanie Gottschalk, First Guaranty Bank

2.  Income/Expenses Reported on 1040 Schedules  Schedule C – Business Income  Schedule E – Royalty and Rental Income  Schedule F – Farm Income  No balance sheet is provided with schedule  Generally, the customer cannot produce a useful balance sheet  Assets and liabilities co-mingled with Personal  If produced at all (such as from Quickbooks) it is of doubtful usefulness as generally not professionally maintained 2

3.  A balance sheet is not necessary as the assets are co- mingled in the Personal Financial Statement  Basically banks need ability to complete a Traditional Cash Flow analysis with DSCR calculation on the schedule 3

4.  Currently, many customers are creating a separate “fake” business entity for the schedule simply to arrive at the Traditional Cash Flow DSCR  Creating a fake business entity is undesirable as  it is extra work to spread fake entity separately  the user must remember to exclude fake entity from global  adds a fake party to the relationship which can affect reports 4

5.  Schedule C, E (Rental Income) and F have a Traditional Cash Flow Analysis section at bottom 5

6. 6  Start with Income/(Loss) add back non-cash expenses and subtract Interest Expense and allow for other adjustments  Net Cash Flow/Net Cash to Service Debt Calculated

7. 7  Enter Current Debts  Change labels  Insert rows

8.  Cash Flow Surplus (Deficit)  DSCR 8

9.  Min-Fins Supported!  Insert in Word Narratives 9

10.  Insert from LoanVantage Toolbar “Taxes and schedules”  Available schedules will be displayed  If more than one schedule exists, all will be displayed and you will pick the one you wish to insert 10

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12.  Currently, the Debts entered on the schedules do not populate the Personal Cash Flow  Suggestion is that if debts are entered on schedules to bring that debt in automatically to Personal Cash Flow Debts Section  Since there can be multiple Schedule C, Schedule E – Rental Income, and Schedule F entities the schedule debt would populate as lump sum 12

13.  If schedule debts were not entered these first three rows would be blank  If schedule debts are entered, they will be brought in and the user will need to remember to not include them in the personal debt 13

14.  If you have never entered schedule debt, the enhancement to push schedule debts to the Personal Cash Flow will not impact you  If you have entered schedule debt and you re-transfer an old period to the Personal Cash Flow you will need to zero out the Schedule Debts that will be are transferred for that period or adjust your personal debts accordingly to prevent duplication of debts 14

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